Question

The following information is related to Somerset Company's fiscal year 2018.

            Income Statement:

                        Net Income                             $4,000,000

                        Depreciation Expense 650,000

                        Gain on Sale of Plant Assets   50,000

                        Interest Expense                             5,000

            Balance Sheet - 12/31/17: Increase (Decrease)

                        Accounts Receivable ($45,000)

                        Plant Assets - Purchased        250,000

                        Plant Assets - Disposals         (100,000)

                       

            Additional Information:

                        Common Stock exchanged for outstanding Long Term Notes Payable of $150,000

                        Dividends paid were $35,000

Use this information to prepare a partial Statement of Cash Flows for Somerset Company. Prepare only the section related to Cash Flows from Operating Activities.

Partial Statement of Cash Flows:

Somerset Company
Statement of Cash Flows (Partial)
For the year ended December 31, 2018

Answer 1

Somerset Company
Statement of Cash Flows (Partial)
For the year ended December 31, 2018
	Amount $
Net Income	4,000,000
Add: Depreciation Expense	650,000
Less: Gain on sale of Plant assets	-50,000
Add: Decrease in accounts receivable	45,000
Net Cash flow from operating activities	4,645,000