Following are comparative balance sheets for Millco, Inc., at January 31 and February 28, 2011:

MILLCO, INC. Balance Sheets February 28 and January 31, 2011
Assets	February 28			January 31
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

Required:

(a)

Calculate the change that occurred in cash during the month. You may assume that the change in each balance sheet amount is due to a single event (for example, the change in the amount of production equipment is not the result of both a purchase and sale of equipment). (Hints: What is the purpose of the statement of cash flows? How is this purpose accomplished?) Because the retained earnings section of the balance sheet is, in and of itself, an analysis of the change in the retained earnings account for the month, the row for net income and dividends should be entered as the February amount and not the change. Use the space to the right of the January 31 data to enter the difference between the February 28 and January 31 amounts of each balance sheet item. (Negative amount should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required.Omit the "$" sign in your response.)

MILLCO, INC. Balance Sheets February 28 and January 31, 2011
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:
depreciation expense
decrease in merchendise inventory
increase in accounts recievable
decrease in other accured liabilities
decrease in accounts payable
Net cash provided by operating activities		$
Cash flows from investing activities:
Purchases of production equipment
Cash flows from financing activities:
sale of common stock	$
payment of long term debt
payment of divedends
Net cash flows used by financing activities
Net increase in cash for the year		$