Now that Allisha McKay (see Question 2 above) has compiled the sources and uses of funds information she needs, she is ready to prepare The Fred Proffet Company’s Statement of Cash Flows for the Year Ended 2012. Help her complete the company’s Statement of Cash Flows by using the information taken from the following Condensed Income Statement and Statement of Retained Earnings for 2012, and the 2011 and 2012 Balance Sheets in Question 2. Then, answer the questions that follow:

THE FRED PROFFET COMPANY Condensed Income Statement and Statement of Retained Earnings For the Period: January 1 through December 31, 2012 Income Statement Sales $5,200,000 Cost of Sales 1,560,000 Gross Profit 3,640,000 Operating Expenses (excluding depreciation) 2,860,000 Depreciation 105,000 Operating Income 675,000 Interest 242,000 Income Before Income Taxes 433,000 Income Taxes (40%) 173,000 Net Income 260,000 Statement of Retained Earnings Retained Earnings, December 31, 2011 1,146,000 Net Income for 2012 260,000 Subtotal 1,406,000 Cash Dividends Paid in 2012 156,000 Retained Earnings, December 31, 2012 1,250,000 THE FRED PROFFET COMPANY Statement of Cash Flows December 31, 2012 Net Cash Flow from Operating Activities Net Income Adjustments to reconcile net income to net cash flows from operating activities Depreciation Increase in Net Receivables Decrease in Inventories Decrease in Accounts Payable Decrease in Other Current Liabilities Net Cash Flow from Operating Activities Net Cash Flow from Investing Activities Decrease in Marketable Securities Increase in Property and Equipment Net Cash Flow from Investing Activities Net Cash Flow from Financing Activities Decrease in Notes Payable Increase in Long-Term Debt Increase in Capital Stock (Common Stock + Paid in Capital)
Dividends Paid Net Cash Flow from Financing Activities Net Increase in Cash during 2012 Cash at the beginning of 2012 Cash at the end of 2012 Supplementary Disclosure of Cash Flow Information Cash paid during the year for Interest Income Taxes

. What is Allisha’s proper entry for “Net Cash Flow from Operating Activities”?
. What is Allisha’s proper entry for ‘Net Cash Flow from Investing Activities”?
. What is Allisha’s proper entry for ‘Net Cash Flow from Financing Activities”?
. What is Allisha’s proper entry for ‘‘Net increase in Cash during 2012”?
. Since all changes in cash are accounted for in the Statement of Cash Flows, what is the purpose of the “Supplementary Disclosure of Cash Flow Information” portion of the statement?