Assets February 28 January 31 Change Cash $ 42,000 $ 37,000 Accounts receivable 64,000 53,000 Merchandise inventory 81,000 94,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Total current assets $ 187,000 $ 184,000 Plant and Equipment: Production equipment 166,000 152,000 Less: Accumulated depreciation (24,000 ) (21,000 ) -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Total assets $ 329,000 $ 315,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Liabilities: Accounts payable $ 37,000 $ 41,000 Short-term debt 44,000 44,000 Other accrued liabilities 21,000 24,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Total current liabilities $ 102,000 $ 109,000 Long-term debt 33,000 46,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Total liabilities $ 135,000 $ 155,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Owners' Equity Common stock, no par value, 40,000 shares authorized, 30,000 and 28,000 shares issued, respectively $ 104,000 $ 96,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Retained earnings: Beginning balance $ 64,000 $ 43,000 Net income for month 36,000 29,000 Dividends (10,000 ) (8,000 ) -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Ending balance $ 90,000 $ 64,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Total owners' equity $ 194,000 $ 160,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- Total liabilities and owners' equity $ 329,000 $ 315,000 -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- -------------------------------------------------------------------------------- (b) Prepare a statement of cash flows that explains above changes? (Negative amount should be indicated by a minus sign.Omit the "$" sign in your response.) MILLCO, INC. Statement of Cash Flows For the Month Ended February 28, 2011 Cash flows from operating activities: Net income $ Add (deduct) items not affecting cash: (Click to select)Increase in accounts receivableDepreciation expenseDecrease in other accrued liabilities Utilities expenseInvestmentsNote payableDecrease in accounts payableDecrease in merchandise inventory (Click to select)Depreciation expenseDecrease in other accrued liabilities Utilities expenseIncrease in accounts receivableNote payableDecrease in accounts payableInvestmentsDecrease in merchandise inventory (Click to select)Decrease in other accrued liabilitiesDecrease in accounts payableInvestmentsIncrease in accounts receivableNote payableDecrease in merchandise inventory Utilities expenseDepreciation expense (Click to select)Decrease in accounts payableNote payableIncrease in accounts receivableDecrease in other accrued liabilitiesDecrease in merchandise inventoryInvestmentsDepreciation expense Utilities expense (Click to select)Note payableDecrease in accounts payableDecrease in merchandise inventoryDepreciation expenseIncrease in accounts receivableInvestmentsDecrease in other accrued liabilities Utilities expense -------------------------------------------------------------------------------- Net cash (Click to select)providedusedby operating activities $ Cash flows from investing activities: Purchases of production equipment Cash flows from financing activities: (Click to select)Payment of long term debtSale of common stockDecrease in merchandise inventoryIncrease in accounts receivablePayment of dividendsDepreciation expenseDecrease in accounts payable Production equipment $ (Click to select)Payment of long term debtIncrease in accounts receivable Production equipmentSale of common stockDecrease in accounts payableDepreciation expensePayment of dividendsDecrease in merchandise inventory (Click to select)Increase in accounts receivableDecrease in merchandise inventorySale of common stockPayment of long term debtPayment of dividendsDepreciation expense Production equipmentDecrease in accounts payable -------------------------------------------------------------------------------- Net cash flows (Click to select)providedusedby financing activities -------------------------------------------------------------------------------- Net (Click to select)decreaseincreasein cash for the year $