Question

The comparative balance sheet of Canace Products Inc. for December 31, 20Y6 and 20Y5, is as follows:

		Dec. 31, 20Y6		Dec. 31, 20Y5
Assets
Cash		$229,800		$212,040
Accounts receivable (net)		83,250		76,160
Inventories		235,000		225,480
Investments		0		87,360
Land		120,540		0
Equipment		259,280		199,350
Accumulated depreciation		(60,700)		(53,760)
	Total assets	$867,170		$746,630
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)		$156,960		$147,090
Accrued expenses payable (operating expenses)		15,610		19,410
Dividends payable		8,670		6,720
Common stock, $10 par		46,830		36,580
Paid-in capital: Excess of issue price over par-common stock		176,040		101,540
Retained earnings		463,060		435,290
	Total liabilities and stockholders’ equity	$867,170		$746,630

The income statement for the year ended December 31, 20Y6, is as follows:

Sales					$1,392,530
Cost of goods sold					573,400
Gross profit					$819,130
Operating expenses:
	Depreciation expense		$6,940
	Other operating expenses		723,060
		Total operating expenses			730,000
Operating income					$89,130
Other expense:
		Loss on sale of investments			(23,590)
Income before income tax					$65,540
Income tax expense					20,970
Net income					44,570

Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows:

Equipment and land were acquired for cash.

There were no disposals of equipment during the year.

The investments were sold for $63,770 cash.

The common stock was issued for cash.

There was a $16,800 debit to Retained Earnings for cash dividends declared.

Required:

Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.

Canace Products Inc.
Statement of Cash Flows
For the Year Ended December 31, 20Y6
Cash flows from operating activities:
	$
Net cash flow from operating activities		$
Cash flows from investing activities:
	$
Net cash flow used for investing activities
Cash flows from financing activities:
	$
Net cash flow from financing activities
		$
Cash at the beginning of the year
Cash at the end of the year		$

Answer 1

Cash flow Statement:
Cash flows from Operating Activities:
Cash received ffrom Accounts receivable (1392530+76160-83250)							1385440
Cash paid for inventory (573400+235000-225480+147090-156960)							-573050
Operating expense paid (723060+19410-15610)							-726860
Income tax expense							-20970
Net cash provided from Operating activities								64560
Cash flows from Investing activities:
Sale of investment							63770
Purchase of land							-120540
Purchase of equipment							-59,930
Net cash used in Investing activities								-116700
Cash flows from financing activities:
Dividend paid		(16800+6720-8670)					-14850
Common Stock issued			(46830+176040-36580-101540)				84750
Net cash provided from Financing activities								69900
Net increase in cash								17760
Beginning Balance in cash								212040
Ending balance in cash								229800