Question

     Terry company's 2017 income statement and comparative balance sheets at December 31 of 2016 and 2017are shown.

Terry Company

                                                                    Income Statement

         For the year Ended December 31, 2017

    Sales                                                 $ 390,000

    Cost of Goods Sold                             235,000

                                                                                _______

       Gross Profit                                                          $ 155,000

    Wages Expenses                              $ 63,000

    Depreciation Expense                         14,000

    Other Operating Expenses                  26,000

    Income Tax Expense                           17,000           120,000

                                                                                 ______        ________

       Net Income                                                           $ 35,000

                                                  

Terry Company

Balance Sheets

                                                                       Dec. 31,            Dec. 31,

                    Assets                                          2016                 2017

                   Cash                                          $ 16,000         $ 30,000

                   Accounts Receivable (net)            28,000            35,000

                   Inventory                                    110,000            84,000

                   Prepaid Expense                           12,000             8,000

                   Plant Assets                                 178,000           130,000

                   Accumulated Depreciation          (76,000)          (62,000)

                                        

                      Total Assets                             $ 268,000         $ 225,000

                                       

                   Liabilities and Stockholders' Equity

                   Accounts Payable                       $ 27,000         $ 14,000

                   Wages Payable                                 6,000                2,500

                   Income Tax Payable                         3,000               4,500

                   Common Stock                             135,000           125,000

                   Retained Earnings                           97,000             79,000

                                                                          ________        _________

                    Total Liabilities and                    $ 268,000         $ 225,000

                   

                    Stockholders' Equity           

    

Cash dividends of $17,000 were declared and paid during 2016 Plant assets of $48,000 were purchased for cash, and later in the year, an additional $10,000 common stock was issued for cash

REQUIRED

            Prepare only the Cash Flows from Operations section of the Cash Flow Statement using the

             indirect method.

Reminder: you need only prepare the Cash Flow from Operations section of the statement

Answer 1

Terry's Company
Statement of Cash Flow
For the year ended December 31, 2017
	Amount	Amount
Cash Flows from Operating activities
Net Income		35,000
Adjusted to reconcile net income to net
cash provided by operating activities:
Depreciation expense	14,000
Decrease in inventories	26,000
Decrease in prepaid expenses	4000
Increase in income tax payable	1,500
Increase in account receivable	(7,000)
Decrease in account payable	(13,000)
Decrease in wages payable	(3,500)	22,000
Net cash provided by operating activities		57,000