Question

Exercise 4-21 Statement of cash flows; direct method [LO4-8]

Presented below is the 2018 income statement and comparative balance sheet information for Tiger Enterprises.

TIGER ENTERPRISES
Income Statement
For Year Ended December 31, 2018
($ in thousands)
Sales revenue		$7,600
Operating expenses:
Cost of goods sold	$3,460
Depreciation	340
Insurance	200
Administrative and other	1,900
Total operating expenses		5,900
Income before income taxes		1,700
Income tax enpense		700
Net Income		$1,000
Balance Sheet Information ($ in thousands)	Dec. 31, 2018	Dec. 31, 2017
Assets:
Cash	$400	$300
Accounts receivable	850	930
Inventory	740	700
Prepaid insurance	100	70
Plant and equipment	2,600	2,300
Less: Accumulated depreciation	(1,040)	(700)
Total assets	$3,640	$3,600
Liabilities and Sharholders' Equity:
Accounts payable	$400	$460
Payable for administrative and other expenses	400	500
Income taxes payable	300	250
Note payable (due 12/31/2019)	900	700
Common stock	1,000	900
Retained earnings	650	790
Total liabilities and sharholders' equity	$3,650	$3,600

Required: Prepare the cash flows from operating activities section of Tiger's 2018 statement of cash flows using the direct method. Assume that all purchases and sales of inventory are on account, and that there are no anticipated bad debts for accounts receivable. (Hint: Use T-accounts for the pertinent items to isolate the information needed for the statement.) (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands.)

TIGER ENTERPRISES
Statement of Cash Flows
For the Year Ended December 31, 2018
Details	Amounts ($)	Amounts ($)
Cash flows from operating activities:
Net cash flows from operating activities

Answer 1