Consider the following balance sheet and income statement data for Landmark International.

a. Develop a statement of cash flows similar to Exhibit 1-2

b. Explain why the cash balance increased by $350 when the company generated a net profit of $405.

Landmark International, Inc. BalanceSheet 12/31/03 (000's)
Cash - $200	Accounts Payable - $200
Accounts Receivable - $800	Operating Accruals - $300
Inventory - $250	Debt - $750
Fixed Assests - $1000	Common Stock - $400
(Accumulated depr.) $400	Retained Earnings - $200
Total - $1850	Total - $1850

Landmark International, Inc. Balance Sheet 12/31/04 (000's)
Cash $550	Accounts payable $250
Accounts Receivable - $700	Operating Accruals - $150
Inventory - $150	Debt - $395
Fixed Assests - $1000	Common Stock - $400
Accumulated depr $600	Retained Earnings - $605
Total - $1800	Total - $1800

Landmark InternationaL Inc. Income Statement For the Year Ended 12/31/04 (00S)
Sales	$4500
Cost of Goods Sold	$2200
Gross Profit	2300
Operating Expenses:
Salaries Advertising etc	1300
Depreciation	200
Operating Profit	800
Interest	75
Taxes	320
Net Profit	405
Dividends	0
Addition to retained earnings	405