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. 31 105,000

Cash paid to acquire plant assets 25,000

Proceeds from short-term borrowing 10,000

Loans made to borrowers 4,400

Collections on loans (excluding interest) 4,000

Interest and dividends received 27,600

Cash received from customers 795,000

Proceeds from sales of plant assets 9,000

Dividends paid 44,000

Cash paid to suppliers and employees 618,000

Interest paid 19,000

Income taxes paid 66,000

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
	$	$
Operating activities:
Cash received from customers	7,95,000.00
Cash paid to Suppliers and employees	-6,18,000.00
Income tax paid	-66,000.00
Net cash provided by operating activities	1,11,000.00
Investing activities:
Acquisition of plant assets	-25,000.00
Interest and dividends received	27,600.00
Sale of plant assets	9,000.00
Loan made to borrowers	-4,400.00
Collection on loans (excluding interest)	4,000.00
Net cash used in investing activities	11,200.00
Financing activities:
Proceeds from Short Term Borrowing	10,000.00
Dividend paid	-44,000.00
Interest paid	-19,000.00
Net cash used in financing activities	-53,000.00
Net increase in cash	69,200.00
Beginning cash and cash equivalents	35,800.00
Ending cash and cash equivalents		1,05,000.00