(SCF—Indirect Method, and Net Cash Flow from Operating Activities, Direct Method) Comparative balance sheet accounts of Secada Inc. are presented below.

Instructions

(a) Compute net cash flow from operating activities using the direct method.

(b) Prepare a statement of cash flows using the indirect method.

SECADA INC. COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31, 2008 AND 2007 December 31 Debit Accounts Cash Accounts Receivable 2008 2007 $ 45,000 $ 33,750 67,500 60,000 Merchandise Inventory Investments (available-for-sale) Machinery 30,000 24,000 22,250 38,500 30,000 18,750 Buildings 67,500 56,250 Land 7,500 7,500 $269,750 $238,750 Credit Accounts Allowance for Doubtful Accounts $ 2,250 $ 1,500 Accumulated Depreciation-Machinery 5,625 2,250 Accumulated Depreciation-Buildings 13,500 9,000 Accounts Payable 30,000 24,750 Accrued Payables 3,375 2,625 Long-Term Note Payable 26,000 31,000 Common Stock, no par 150,000 125,000 Retained Earnings 39,000 42,625 $269,750 $238,750