1.

Cash Flows from Investing Activities

During the year, Hayashi, Inc. sold equipment with a book value of $125,000 for $175,000 (original purchase cost of $225,000). New equipment was purchased.

Hayashi provided the following comparative balance sheets:

Hayashi, Inc. Comparative Balance Sheets At December 31, 20X1 and 20X2
	20X1	20X2
Long-Term Assets
Plant and equipment	$1,000,000	$1,025,000
Accumulated depreciation	(500,000)	(525,000)
Land	500,000	712,750

Required:

Calculate the investing cash flows for the current year. Use a minus sign to indicate a cash outflow.

2.

Tidwell Company has provided the following partial comparative balance sheets and the income statement for 20X2.

Tidwell Company

Comparative Balance Sheets

At December 31, 20X1 and 20X2

1		20X1	20X2
2	Current assets:
3	Accounts receivable	$353,000.00	$277,500.00
4	Inventories	130,000.00	154,000.00
5	Current liabilities:
6	Accounts payable	301,000.00	239,000.00

Tidwell Company

Income Statement

For the Year Ended December 31, 20X2

1	Revenues	$1,200,000.00
2	Gain on sale of equipment	48,000.00
3	Cost of goods sold	(652,000.00)
4	Depreciation expense	(124,000.00)
5	Interest expense	(21,000.00)
6	Net income	$451,000.00

	Required:
	Compute operating cash flows using the direct method.