Question

The comparative balance sheets of Pharoah Inc. at the beginning and the end of the year 2017 are as follows.

PHAROAH INC. BALANCE SHEETS
		Dec. 31, 2017		Jan. 1, 2017		Inc./Dec.
Assets
Cash		$ 48,220		$ 16,220		$32,000	Inc.
Accounts receivable		95,670		89,450		6,220	Inc.
Equipment		43,670		23,450		20,220	Inc.
Less: Accumulated Depreciation-Equipment		21,670		11,000		10,670	Inc.
Total		$165,890		$118,120
Liabilities and Stockholders’ Equity
Accounts payable		$ 24,670		$ 16,450		8,220	Inc.
Common stock		103,220		81,450		21,770	Inc.
Retained earnings		38,000		20,220		17,780	Inc.
Total		$165,890		$118,120

Net income of $48,670 was reported, and dividends of $30,890 were paid in 2017. New equipment was purchased and none was sold.

Prepare a statement of cash flows for the year 2017.

Answer 1

Statement of cash flow :

Cash flow from operating activities
Net income	48670
Adjustment to reconcile net income
Depreciation expenses	10670
Increase account receivable	(6220)
Increase account payable	8220
Net cash flow from operating activities		61340
Cash flow from investing activities
Purchase equipment	(20220)
Net cash flow from investing activities		(20220)
Cash flow from financing activities
Dividend paid	(30890)
Issue common stock	21770
Net cash flow from financing activities		(9120)
Net cash flow		32000
Beginning cash		16220
Ending cash		48220