Work Sheet (Appendix)

Assume that a company uses a work sheet as illustrated in Exhibit 12-16 to prepare its statement of cash fl ows and that it uses the indirect method in the Operating Activities section of the statement. For each of the following changes in balance sheet accounts, indicate in one of the three columns whether it is an addition (A) or a deduction (D).

Assume that the change in (2) and (6) includes a corresponding change in cash.

Type of Activity Balance Sheet Change Operating Investing Financing 1. Accounts receivable increased ________ ________ ________ 2. Land increased ________ ________ ________ 3. Inventory decreased ________ ________ ________ 4. Accounts payable decreased ________ ________ ________ 5. Income taxes payable increased ________ ________ ________ 6. Capital stock increased ________ ________ ________.

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