Question

Exercise 11-45 (Algorithmic) Partial Statement of Cash Flows Service Company had net income during the current year of $114,000. The following information was obtained from the balance sheet of Service Company: Accounts receivable $21,300 increase Inventory Accounts payable Interest payable 28,700 increase 14,240 decrease 3,180 increase 12,340 increase 27,800 increase Accumulated depreciation, building Accumulated depreciation, equipment Additional Information: 1. Equipment with accumulated depreciation of $15,000 was sold during the year. 2. Cash dividends of $36,000 were paid during the year.

Answer 1

STATEMENT OF CASH FLOW
	Amount in $	Amount in $
Net income		$          1,14,000
Cash flows from operating activities
Adjustments to reconcile net income to Operating Cash Flow From Operating activities
Depreciation Expenses ($ 12,340 + $ 27,800+ $ 15,000)	$             55,140
Increase in Account receivables	$            -21,300
Increase in Inventory	$            -28,700
Decrease in Account Payable	$            -14,240
Increase in interest Payable	$                3,180
		$              -5,920
Net cash from operating activities		$          1,08,080