Instructions X The comparative balance sheet of Yellow Dog Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows: 1 Dec. 31, 20Y8 Dec. 31, 20Y7 2 Assets 3 Cash $95,000.00 $110,000.00 4 Accounts receivable (net) 260,000.00 280,000.00 5 Inventories 520,000.00 450,000.00 6 Prepaid expenses 15,000.00 5,000.00 7 Equipment 1,130,000.00 800,000.00 8 Accumulated depreciation-equipment (235,000.00) (190,000.00) 9 Total assets $1,785,000.00 $1,455,000.00 10 Liabilities and Stockholders' Equity 11 Accounts payable (merchandise creditors) $100,000.00 $75,000.00 12 Mortgage note payable 0.00 500,000.00 13 Common stock. $10 par 500.000.00 200.000.00Instructions 13 Common stock, $10 par 500,000.00 200,000.00 14 Paid-in capital in excess of parcommon stock 400,000.00 100,000.00 15 Retained earnings 785,000.00 580,000.00 16 Total liabilities and stockholders' equity $1,785,000.00 $1,455,000.00 Additional data obtained from the income statement and from an examination of the accounts in the ledger tor 20Y8 are as follows: a. Net income, $250,000. b. Depreciation reported on the income statement, $135,000. 6. Equipment was purchased at a cost of $420,000 and fully depreciated equipment costing $90,000 was discarded, with no salvage realized. d. The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty. e. 30,000 shares of common stock were issued at $20 for cash. 1'. Cash dividends declared and paid, $45,000. Prepare a statement of cash flows, using the indirect method of presenting cash ows from operating activities. Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. Be sure to complete the heading of the statement. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative aajiustments. Labels and Amount Descriptions Labels and Amount Descriptions Cash paid for dividends Cash paid for equipment Cash paid for merchandise Cash paid for purchase of land Cash paid to retire mortgage note payable Cash received from customers Cash received from sale of common stock December 31, 20Y8 Decrease in inventories Decrease in accounts payable Decrease in accounts receivable Decrease in prepaid expenses Depreciation For the Year Ended December 31, 20Y8 Gain on disposal of equipment Gain on sale of investments Increase in accounts payable Increase in accounts receivable Increase in inventories Increase in prepaid expenses Loss on disposal of equipment Loss on sale of investments Net cash flow from financing activities Net cash flow from investing activities Net cash flow from operating activities Net cash flow used for financing activities Net cash flow used for investing activities Net cash flow used for operating activities Net decrease in cash Net income Net increase in cash Net loss Statement of Cash Flows ' Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. Be sure to complete the heading of the statement. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Yellow Dog Enterprises Inc. Score: 69/149 Statement of Cash Flows For the Year Ended December 31, 20Y8 .. Cash flows from (used for) operating activities: 2 Net income $250,000.00 " w Adjustments to reconcile net income to net cash ow from operating activities: In Changes in current operating assets and liabilities: 6 Increase in prepaid expenses V 10,000.00 7 Decrease in accounts receivable V 20,000.00 V 3 Increase in accounts payable V 25,000.00 V Statement of Cash Flows Shaded cells have feedback. X Increase in accounts payable 25,000.00 9 Increase in inventories 10 $350,000.00 11 12 Cash flows from (used for) investing activities: 13 14 15 16 Cash flows from (used for) financing activities: 17 $600,000.00 18 19 Increase in prepaid expenses 10,000.00 20 Net cash flow from financing activities 55,000.00 21 Net cash flow from investing activities 22 Cash balance, January 1, 20Y8 110,000.00 23 Cash balance, December 31, 20Y8 $95,000.00