Consultex, Inc., was founded in 2015 as a small financial consulting business. The company had done reasonably well in 2015-2017 but started noticing its cash dwindle early in 2018. In January 2018. Consultex had paid $16,000 to purchase land and repaid $2,000 principal on an existing promissory note. In March, the company paid $2,000 cash for dividends and $1,000 to repurchase and eliminate Consultex stock that had previously been issued for $1,000. To improve its cash position, Consultex borrowed $5,000 by signing a new promissory note in May and also issued stock to a new private investor for $12,000 cash. Year-end comparative balance sheets and income statements are presented below. CONSULTEX, INC. Balance Sheet October 31 2018 2017 $11,000 $14,000 14,000 12,000 2,000 3,000 26,000 10,000 $53,000 $39,000 Assets Cash Accounts Receivable Prepaid Rent Land Total Assets Liabilities and Stockholders' Equity Salaries and Wages Payable Income Taxes Payable Notes Payable (long-term) Common Stock Retained Earnings Total Liabilities and Stockholders' Equity $ 2,000 $ 3,000 1,000 1,000 15,000 12,000 20,000 9,000 15,000 14,000 $53,000 $39,000 CONSULTEX, INC Income Statement For the Year Ended October 31 Sales Revenue Salaries and Wages Expense Rent Expense Utilities Expenses Income before Income Tax Expense Income Tax Expense Net Income 2018 2017 $158, eee $161, eee 98, 97,000 36, eee 30, eee 19,780 20,eee 4,300 14,888 1,300 4,2ee $ 3,800 $ 9,800 Required: 1. Prepare a properly formatted Statement of Cash Flows for Consultex, Inc., for the year ended October 31, 2018 (using the indirect method). (Amounts to be deducted should be indicated with a minus sign.) CONSULTEX, INC. Statement of Cash Flows For the Year Ended October 31, 2018 Cash Flows from Operating Activities: $ 3,000 Net Income Changes in Current Assets and Current Liabilities Accounts Receivable Prepaid Rent Salaries and Wages Payable (2,000) 1,000 (1,000) 1,000 Cash Provided by Operating Activities Cash Flows from Investing Activities: Purchased Land (16,000) Cash Used in Investing Activities (16,000) Purchased Land (16,000) (16,000) Cash Used in Investing Activities Cash Flows from Financing Activities: Paid Cash Dividends Repaid Promissory Note Principal Repurchased Company Common Stock Issued New Promissory Note Issued New Company Common Stock OOOOOOO ! 0 Cash Provided by Financing Activities Net Decrease in Cash Beginning Cash Position, October 31, 2017 Ending Cash Position, October 31, 2018