1. Following are the income statement and some additional information.

See Untitled1.png

Required:

Prepare the cash flows from operating activities section of the statement of cash flows using the direct method.

2. The balance sheets for Ryan Company showed the following information. Additional information concerning transactions and events during 2008 are presented below.

Ryan Company

Balance Sheet

December 31

2008 2007

Cash $ 31,900 $ 10,200

Accounts receivable (net) 40,000 20,300

Inventory 37,300 42,000

Long-term investments 0 15,000

Property, plant & equipment 236,500 150,000

Accumulated depreciation (37,700) (25,000)

$308,000 $212,500

Accounts payable $ 20,000 $ 26,500

Accrued liabilities 18,000 17,000

Long-term notes payable 70,000 50,000

Common stock 130,000 90,000

Retained earnings 70,000 29,000

$308,000 $212,500

Additional data:

1. Net income for the year 2008, $76,000.

2. Depreciation on plant assets for the year, $12,700.

3. Sold the long-term investments for $27,000.

4. Paid dividends of $35,000.

5. Purchased machinery costing $26,500, paid cash.

6. Purchased machinery and gave a $60,000 long-term note payable.

7. Paid a $40,000 long-term note payable by issuing common stock.

Required: Prepare a statement of cash flows (full statement) for 2008 in good form. Note: use indirect method for cash flows from operating activities).