INSTRUCTIONS

The income statement of Booker T Industries Inc. for the current year ended June 30 is as follows:

1 Sales $513,000.00

2 Cost of merchandise sold 295,400.00

3 Gross profit $217,600.00

4 Operating expenses:

5 Depreciation expense $39,730.00

6 Other operating expenses 105,620.00

7 Total operating expenses 145,350.00

8 Income before income tax $72,250.00

9 Income tax expense 21,900.00

10 Net income $50,350.00

*Changes in the balances of selected accounts from the beginning to the end of the current year are as follows:

Increase (Decrease)

Accounts receivable (net) ($11,600)

Inventories 3,510

Prepaid expenses (3,160)

Accounts payable (merchandise creditors) (8,950)

Accrued expenses payable (operating expenses) 1,100

Income tax payable (1,690)

Prepare the Cash Flows from Operating Activities section of the statement of cash flows , using the direct method. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Deduct, Add or colons (:) will automatically appear if required. Amount Descriptions: Cash paid for dividends Cash paid for purchase of land Cash payments for income taxes Cash payments for merchandise Cash payments for operating expenses Cash received from customers Cash received from sale of common stock Cash received from sale of land Net cash flow from operating activities Net cash flow used for operating activities *Prepare the Cash Flows from Operating Activities section of the statement of cash flows , using the direct method. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Deduct, Add or colons (:) will automatically appear if required.

Booker T Industries Inc.

Cash Flows from Operating Activities

Section For the Year Ended June 30

1 Cash flows from operating activities:

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3

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6