Case 2. Cash Flow Preparation Below is the analysis of the Statement of Cash flow of Carpet Company. (10 marks) Dec. 31, Prior Year Analysis of Changes Debit Credit Dec. 31, Current Balance sheet--debits Cash Accounts receivable $100,000 $105,000 $80,000 (b) 10,000.00 $70,000 Inventory Equipment Total Debits Balance sheet--credits Accum depr Equip. $150,000 (c) $40,000 $190,000 $150,000 (g) 65,000 $215,000 $480,000 $580,000 $50,000 (f) 10,000 $60,000 Accounts payable $15,000 (d) 5,000 $10,000 Income taxes payable $15,000 (e) 5,000 $10,000 Common stock, $5 par value $250,000 (h) 15,000 $265,000 Paid-in capital in excess of par $20,000 (h) 45,000 $65,000 value, common stock Total Credits Retained earnings Statement of cash flows Operating activities Net income $130,000 20,000 (a) 60,000 $170,000 $480,000 $580,000 (a) 60,000 Decrease in accounts (b) 10,000 receivable Increase in inventory (c) 40,000 Decrease in accounts payable (d) 5,000 Decrease in income taxes (e) 5,000 payable Depreciation expense (f) 10,000 Investing activities Payment for equipment (g) 65,000 Financing activities Issued common stock for cash (h) 60,000 Paid cash dividends 20.000 $275,000 $275,000