Natalie Daniels has completed the basic format to be used in preparing the state

Question

Natalie Daniels has completed the basic format to be used in preparing the statement of cash flows (indirect method) for CPU Hardware Designers. All amounts are in thousands (000s).

  

Below, in random order, are line items to be included in the statement of cash flows.

   

  

Prepare the statement of cash flows for CPU Hardware Designers using the indirect method. (List cash outflows and any decrease in cash as negative amounts. Enter your answers in thousands.)

CPU HARDWARE DESIGNERS
Statement of Cash Flows
For the year ended December 31, 2015   Cash Flows from Operating Activities      Net income     Adjustments for noncash effects:     Changes in current assets and current liabilities:      Net cash flows from operating activities   Cash Flows from Investing Activities      Net cash flows from investing activities   Cash Flows from Financing Activities      Net cash flows from financing activities   Net increase (decrease) in cash $ (34,600)   Cash at the beginning of the period 87,000      Cash at the end of the period $ 52,400   

Explanation / Answer

CPU HARDWARE DESIGNERS
Statement of Cash Flows
For the year ended December 31, 2015

i) Cash Flows from Operating Activities  

Net income $77,000

Adjustments for noncash effects:
      
       Depreciation expense $27,000  
       Loss on sale of land $7,700

Changes in current assets and current liabilities:  
      
       Increase in accounts receivable ($67,000)
       Increase in accounts payable $11,000
       Increase in inventory ($37,000)
       Increase in prepaid rent ($11,000)

  Net cash flows from operating activities $7,700  

ii) Cash Flows from Investing Activities  

Sale of Agricultural Land $3,700
Purchase of equipment               ($227,000)

Net cash flows from investing activities ($223,300)

iii) Cash Flows from Financing Activities
  
  Issuance of common stock           $285,000  
Payment of dividends ($47,000)
Repayment of notes payable ($57,000)
       
Net cash flows from financing activities $181,000

  

Net increase (decrease) in cash ($34,600)
  
Cash at the beginning of the period $87,000   

Cash at the end of the period $52,400   

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