Question

The accounting staff of Wyoming Outfitters, Inc., has assembled the following information for the current year ended December 31. Cash and cash equivalents, Jan. 1 $ 35,800 Cash and cash equivalents, Dec. 31 120,900 Cash paid to acquire plant assets 23,000 Proceeds from short-term borrowing 10,000 Loans made to borrowers 4,300 Collections on loans (excluding interest) 4,000 Interest and dividends received 41,400 Cash received from customers 805,000 Proceeds from sales of plant assets 9,000 Dividends paid 54,000 Cash paid to suppliers and employees 613,000 Interest paid 19,000 Income taxes paid 71,000 Using this information, prepare a statement of cash flows under direct method. (List any deduction in cash and cash outflows as negative amounts.)

Answer 1

	WYOMING OUTFITTERS, INC.
	Statement of Cash Flows
	For the Year Ended December 31
Cash flows from operating activities:
Cash received from customers	805000
Interest and dividends received	41400
Cash provided by operating activities		846400
Cash paid to suppliers and employees	-613000
Interest paid	-19000
Income taxes paid	-71000
Cash disbursed for operating activities		-703000
Net cash flow from operating activities		143400
Cash flows from investing activities:
Loans made to borrowers	-4300
Collections on loans	4000
Cash paid to acquire plant assets	-23000
Proceeds from sales of plant assets	9000
Net cash used by investing activities		-14300
Cash flows from financing activities:
Proceeds from short-term borrowing	10000
Dividends paid	-54000
Net cash used by financing activities		-44000
Net increase in cash and cash equivalents		85100
Cash and cash equivalents, beginning of year		35800
Cash and cash equivalents, end of year		120900