INTRODUCTION TO FINANCIAL ACCOUNTING (USAC21) TEST 2 (1 HOUR) QUESTION 1 (25 MARKS) DD Corporation reports the following financial information to be used in the preparation of statement of cash flows. 31 December 2017 DD Corporation Balance Sheet as at 31 December 31 December 2018 $ Non-Current Assets Land 69 100 Equipment (Net Book Value) 22 600 49 500 53 100 Current Assets Cash and cash equivalents Accounts receivable Inventories Prepaid insurance 17 300 45 700 61 400 1 800 4 000 44 500 47 000 3 900 Total Assets 284 400 171 500 Liabilities and Shareholders' Equity Accounts payable Salary payable Rent payable Long term notes payable Paid in capital Retained earnings 35 200 24 000 22 100 51 000 88 600 26 900 13 100 23 700 34 000 65 900 7 900 27500 Total Liabilities and Shareholders' Equity 248 400 171500 Additional information: 1. There was no disposal of equipment during the year ended 31 December 2018. $ DD Corporation Income Statement for the Year Ended 31 December 2018 $ Sales 446 000 Less: Cost of goods sold 186 600 Gross profit 259 400 Less: Expenses Salary expense Depreciation expense Interest expense Rent expense Insurance expense Advertising expense Net income before tax Less: income tax Net income after tax 76 000 17 700 24 100 30 000 2 100 17 600 (167 500) 91 900 (29 000) 62 900 REQUIREMENT: 1. Prepare a statement of cash flows for DD Corporation for the year ended 31 December 2018 using direct method. (Show all workings) (19 MARKS)