The following combined income and retained earnings statement, along with selected balance sheet data, are provided for the Timberdale Company.

Instructions:
1. Using the direct method, compute the amount of net cash provided by (used in)
operating activities for Timberdale Company for 2002.
2. What is the impact of dividends paid on net cash from operations? Explain.

Transcribed Image Text:

Revenues: Net sales revenue Other revenues Total revenues Expenses: Cost of goods sold Timberdale Company Combined Income and Retained Earnings Statement For the Year Ended December 31, 2002 $170,000 9,000* $179,000 Selling and administrative expenses Depreciation expense Interest expense Total expenses Income before income taxes. Income taxes Net income Retained earnings, January 1, 2002 Dividends declared and paid Retained earnings, December 31, 2002 "Gain on sale of equipment (cost, $19,000; book value, $12,000; sales price, $21,000). $102,000 29,400 6,400 2,800 140,600 $ 38,400 11,520 $ 26,880 67,000 $ 93,880 5,000 $ 88,880