42.At Jungle Industries, all sales are on account. Domenic Marconi is responsible for mailing invoices to customers, recording the amount billed, opening mail, recording the payment, and making deposits to the bank. The customers know Domenic and sometimes send personal notes with their payments. Another clerk handles all aspects of accounts payable. Domenics brother, who is president of Jungle Industries, has hired an accountant to help with expansion.

Required

1. List some problems with the current accounts receivable system. 2. What suggestions would you make to improve internal control?

3. How would you explain to Domenic that he personally is not the problem?

43. Tradewinds Corporation was organized on January 1, 2017, with the investment of $500,000 in cash by its stockholders. Tradewinds signed a ten-year, $300,000 promissory note at a local bank during 2017 and received cash in the same amount. The company immediately purchased an office building for $800,000, paying in cash. During its first year, Tradewinds generated $35,000 in cash from operations and paid $30,000 in cash dividends.

A) In good form, prepare a statement of cash flows for the year ended December 31, 2017.

B) What does this statement tell you that an income statement does not?