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Paddleboard Inc. began operations on January 1, 2016. Its post-closing trial balance at December 31, 2016...

Paddleboard Inc. began operations on January 1, 2016. Its post-closing trial balance at December 31, 2016 and 2017, is shown below along with some other information.

Paddleboard Inc.
Income Statement
For Year Ended December 31, 2017
(000s)
  Revenues:
        Sales $3,874
        Cost of goods sold 1,626
  Gross Profit 2,248
  Expenses:              
        Other expenses $790
        Depreciation expense 170
        Total operating expenses 960
  Profit from operations 1,288
    Income tax expense 288
  Profit $1,000
Paddleboard Inc.
Post-Closing Trial Balance
(000s)
December 31
  Account 2017 2016
  Cash $3,780          $1,930         
  Receivables 2,880          2,170         
  Merchandise inventory 2,650          3,220         
  Property, plant and equipment 3,130          2,810         
  Accumulated depreciation 2,010          1,840         
  Investments 2,170          2,330         
  Accounts payable 2,010          1,530         
  Accrued liabilities 320          480         
  Bonds payable 3,130          3,300         
  Common shares 3,130          2,180         
  Retained earnings 4,010          3,130         


Other information regarding Paddleboard Inc. and its activities during 2017:
1. Assume all accounts have normal balances.
2. Cash dividends were declared and paid during the year.
3. There were no sales of property, plant, and equipment assets during the year.
4. Investments were sold for cash at their original cost.


Required:
Using the information provided, prepare a statement of cash flows (applying the indirect method) for the year ended December 31, 2017. (List any deduction in cash and cash outflows as negative amounts. Enter amounts in thousands, not in dollar.)

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Answer-

PADDLEBOARD INC.
STATEMENT OF CASH FLOWS (USING INDIRECT METHOD)
FOR THE YEAR ENDED DECEMBER 31,2017
Particulars Amount
$
Cash flow from operating activities
Net Income 1000
Adjustments to reconcile net income to net cash provided by operating activities
Adjustment for non cash effects
Depreciation expense 170
Change in operating assets & liabilities
Increase in Accounts receivable -710
Decrease in merchandise inventory 570
Increase in accounts payable 480
Decrease in accrued liabilities -160
Net cash flow from operating activities (a) 1350
Cash Flow from Investing activities
Sale of investments 160
Equipment purchased -320
Net cash Flow from Investing activities (b) -160
Cash Flow from Financing activities
Cash dividends paid ($3130+$1000-$4010) -120
Common stock issued 950
Bonds paid -170
Net cash Flow from Financing activities (c) 660
Net Change in cash c=a+b+c 1850
Beginning cash balance 1930
Closing cash balance 3780
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