Natalie has prepared the balance sheet and income statement of Cookie \& Coffee Creations Inc, for the first year of operations, but does not understand how to prepare the cash flow statement. The income statement and balance sheet appear below. Recall that the company started operations on November 1,2020, so all of the opening balances are zero. Additional information: 1. The company bought kitchen equipment (a commercial oven) for $29,000 on November 1, 2020 , and signed a $12,000 note payable to help pay for it. The terms provide for semiannual fixed principal payments of $2,000 on May 1 and November 1 of each year, plus interest of 5%. All other furniture, fixture, and equipment were purchased during the year for cash. 2. Recall from Chapter 11 that the company originally issued 25,930 common shares for $25,930, of which 750 shares were repurchased from the lawyer for $500. \begin{tabular}{lr} Sales revenue & $462,500 \\ Cost of goods sold & 231,250 \\ \cline { 2 } Gross profit & 231,250 \end{tabular} Operating expenses Other expenses \begin{tabular}{lr} Interest expense & 413 \\ \hline Income bafore income tax & 98.450 \\ Income tax expense & 19.690 \\ \cline { 2 } Net income & $78.760 \\ \hline \end{tabular} COOKIE \& COFFEE CREATIONS INC. Rolanre Chinat COOKIE \& COFFEE CREATIONS INC. Balance Sheet October 31, 2021 Assets Current assets Cash Accounts receivable Imventory Prepaid expenses Property, plant, and equipinent Furniture and fixtures $86,2193.25017,8976,300$113,666 Accumulated depreciation-furniture and fixtures Computer equipment \begin{tabular}{ccc} $12.500 & & \\ \hline(1,250) & 11,250 \\ \cline { 1 } 4,200 & & \\ \hline(600) & 3,600 & \\ \hline 29,000 & & \\ 12,050) & 26,950 & 41,800 \end{tabular} Accumulated depreciation-kitchen equipment Total assets $26,950(2,050)$155,46641,800 Liabilities and Stockholders' Equity Current liabilities Accountspayable Income tax payable Dividends payable Salaries and wages payable interest payable Note payable-current portion 4,000$32.676 Long-termliabilities Note payable-long-term portion Total liabilities 38,6766,000 Stockholders' equity Paid-in capital 3. Recall from Chapter 11 that the company declared a semiannual dividend to the preferred stockholders on April 30 , and the dividend was paid on June 1. The second semiannual dividend was declared to the preferred stockholders on October 31 , to be paid on December 1 . 4. Prepaid expenses relate only to operating expenses. Prepare a statement of cash flows for Cookie & Coffee Creations Inc. for the year ended October 31, 2021, using the indirect method. (Show amounts that decrease cash flow with either a - sign eg. 15,000 or in parenthesis eg. (15,000). If answer is 0 , please enter Q. Do not leave any fields blank.)
