4 Cash Flows from Operating Activities 5 Net Income 6 Plus Depreciation 7 Net of loss and gain) 8 Current Assets 9 Decrease in Accounts Receivable 10 Increase in Inventory 11 Increase in prepaid expenses 12 13 Current Liabilities 14 Increase in Accounts Payable 15 Increase in accrued liabilities 16 Increase in income tax payable 17 Net cash flow from operations 18 19 INVESTMENT ACTIVITIES 20 Investments sold for cash 21 Sold equipment 22 Net equipment purchase 23 Cash loaned to subsidiaries 24 Net cash flows used for investing activities 25 26 27 FINANCIAL ACTIVITIES 28 Net chanage in Bonds payable 29 Common stock issued for cashi 30 Cash Dividend i 31 Net cash flows used for financing activities 32 33 Net increase in cash 34 Cash at the beginning of the year 35 Cash at the end of the year Cash $ 31,000 S 71,000 $ 40,000 Current Assets Acct Receivable 300,000 1200000 900000 Inventory (272,000) 608000 880000 Prepaid Expenses (80,000) 10000 90000 Current Liabilities AP 150,000 550000 400000 Accrued liabilities 20,000 25000 5000 Income tax payable 113,000 133000 20000 Equipment 575,000 900000 325000 Accumulated deprec 35,000 615000 580000 (190,000) 100000 290000 50,000 120000 70000 Long term investments Loans to subsidiaries Bonds payable Common Stock (100,000) 90,000 100000 200000 Retained earnings 106,000 1090000) 496000 1000000 390000 36 37 38 39 40- 41 42 43 44 Notes: Net income $180,000 Equipment was sold for cash in the amount of $100,000 The original cost was $130,000 and it had accumulated depreciation of $40,000 Investments were sold for cash in the amount of $110,000 The onginal cost was $190,000 Equiment was purchased Cash dividends were paid