Prepare statement of cash flows—direct method (Learning Objective 4)

20–25 min.

Use the Charleston Medical Supply, Inc., data from P11-33A. The cash amounts for Interest Revenue, Salaries Expense, Interest Expense, and Income Tax Expense are the same as the accrual amounts for these items.

Requirements 1. Prepare the 2014 statement of cash flows by the direct method.

2. How will what you learned in this problem help you evaluate an investment in Charleston Medical Supply, Inc.?

AppendixLO1