KKL Financial is doing really well. Management is considering an acquisition, however this would require additional bank financing. Tom, the CFO has a great relationship with their bank, and knows that his bank manager will require a statement of cash flows before they can begin to discuss any additional financing.

Tom pulls out the recent balance sheet and gathers up the other necessary information.

KKL Financial Balance Sheet
	December 31, 2021	December 31, 2020
Cash	120,000	105,000
Accounts Receivable	570,000	558,000
Inventory	510,000	486,000
Prepaid Expenses	32,000	64,000
Total Current Assets	1,232,000	1,213,000
Investments	100,000	109,000
Plant & Equipment	2,200,000	1,800,000
Less: Accumulated depreciation	997,000	767,000
TOTAL Assets	2,535,000	2,355,000
Accounts Payable	269,000	237,000
Notes Payable	500,000	500,000
Accrued Expenses	37,000	58,000
Current Liabilities	806,000	795,000
Bonds Payable	150,000	100,000
TOTAL Liabilities	956,000	895,000
Preferred Stock	100,000	100,000
Common Stock	500,000	500,000
Retained Earnings	979,000	860,000
TOTAL Shareholders Equity	1,579,000	1,460,000
TOTAL Liabilities and Shareholders Equity	$2,535,000	$2,355,000

Additional Information:

• Net income for 2021 was $309,000
• Cash dividends of $150,000 were declared and paid to common shareholders
• Preferred dividends of $40,000 were paid
• The company sold $9,000 in long term investments
• The company issued $50,000 in long term bonds

REQUIRED Prepare a statement of cash flows for 2021. Use the following template for your response.

KKL Financial Statement of Cash Flows For the year ended December 31,2021
Operating Activities:
Investing Activities:
Financing Activities:
Net increase/decrease in cash
Cash, beginning of year
Cash, end of year