Question

Sheffield Corp. has recently decided to go public and has hired you as an independent CPA. One statement that the enterprise is anxious to have prepared is a statement of cash flows. Financial statements of Sheffield Corp. for 2022 and 2021 are provided below. BALANCE SHEETS 12/31/22 12/31/21 Cash $407000 $ 192000 Accounts receivable 358000 216000 Inventory 382000 480000 Property, plant and equipment $610000 $960000 Less accumulated depreciation (322000 ) 288000 (302000 ) 658000 $1435000 $1546000 . Accounts payable $ 174000 $ 98000 Income taxes payable 354000 390000 Bonds payable 358000 602000 Common stock 213000 215000 Retained earnings 336000 241000 $1435000 $1546000 INCOME STATEMENT For the Year Ended December 31, 2022 Sales revenue $8390000 Cost of sales 7150000 Gross profit 1240000 Selling expenses $598000 Administrative expenses 191000 789000 Income from operations 451000 Interest expense 71000 Income before taxes 380000 Income taxes 95000 Net income $ 285000 The following additional data were provided: 1. Dividends for the year 2022 were $190000. 2. During the year, equipment was sold for $239000. This equipment cost $350000 originally and had a book value of $288000 at the time of sale. The loss on sale was incorrectly charged to cost of sales. 3. All depreciation expense is in the selling expense category.

The net cash provided by operating activities is

$412000.

$236000.

$200000.

$285000.

Answer 1