Seth Erkanback, a recent college graduate, has just complated the basic format t

Question

Seth Erkanback, a recent college graduate, has just complated the basic format to be usad in preparing the statament of cash flows (indirect method) for ATM Stwre Developers. All amounts are in thousands (000s) ATM SOF TWARE DEVELOPERS Statement of Cash Flows For the year ended December 31, 2019 Cash Flows from Operating Actvities Net income Adjustmants to reconcile net income to net cash flows from operaling activities Net cash fows from operating activities Cash Flows trom Invesing Acimties Net cash tlows from investing activties Cash Flows from Financing Activities Net cash Iows from financing activities Net increase (decreese in cash Cash at the beginning of the peniod S 3,765 7,510 Cash at the end of the penod S 11,275 Listed below in random order are line items to be included in the statement of cash flows Cash receved from the sale ofland Issuance of common stock Depreciation expense Increase in accounts receivable Decrease in accounts payable Issuance of long-term notes payable Purchase of equipment Decrease in irventory Decrease in prepaid rent Payment of dividends Nat income Purchase of treasury stodk S 8,650 13,075 5.465 4,090 1,760 16,495 39.865 1.475 905 6.370 12.400 2815 Required: Prepare the statement of cash flovws for ATM Softrare Developers using the indirect methad. (List cash outflows and any decrease in cash as negative amounts. Enter your answers in thousands (i.,10,000,000 should be entered as "10,000)

Explanation / Answer

Cash flow statement of ATM Software Developers using Indirect Method Cash flows from Operating activities Net Income $12,400 Adjustments to reconcile net income to net cash flows from operating activities Depreciation Expense $5,465 Increase in Accounts Receivables -$4,090 Decrease in Accounts Payable -$1,760 Decrease in Inventory $1,475 Decrease in Prepaid Rent $905 $1,995 Net Cash available from Operating Activities $14,395 Cash flows from Investing activities Cash received from sale of the land $8,650 Purchase of equipment -$39,865 Net Cash used for Investing activities -$31,215 Cash flow from Financing activities Issuance of Common stock $13,075 Issuance of long term notes payable $16,495 Payment of dividend -$6,370 Purchase of Treasury stock -$2,615 Net Cash available from Financing activities $20,585 Net Cash flows $3,765 Cash at the beginning of the period $7,510 Cash at the end of the period $11,275

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