Please answer the following 2 questions on cash flows.

BUSINESS/COMMERCE 450 SUMMER 2016, TERM 2 ASSIGNMENT 6 DUE: August 10 Question 1 (20 marks) Condensed financial data of Alpha Limited, which follows the Canadian Accounting Standards for Private Enterprises (ASPE), for 2015 and 2014 follow: Alpha Limited Balance Sheet Year ended December 31 2015 Cash $ 1,935 FV-NI investments 1,280 Accounts receivable 1,750 Inventory 1,600 Plant assets 1,900 Accumulated depreciation (1,200) $ 7,265 Accounts payable Accrued liabilities Bonds payable Share capital Retained earnings $ 1,200 200 1,400 1,900 2,565 $ 7,265 2014 $ 1,150 1,420 1,300 1,900 1,700 (1,170) $ 6,300 Change $ 785 (140) 450 (300) 200 (30) 985 $ 900 250 1,550 1,700 1,900 $ 6,300 $ 300 (50) (150) 200 685 985 Alpha Limited Income Statement Year ended December 31, 2015 Sales $ 6,900 Cost of goods sold Gross margin 4,700 2,200 Administrative expenses Income from operations Other expenses and gains Interest expense 910 1,290 Loss on investments (FV-NI) Gain on sale of investments (FV-NI) Income before tax Income tax expense Net income $ (20) (20) 80 40 1,330 405 $ 925 Additional information: During the year, $70 of common shares were issued in exchange for plant assets. No plant assets were sold in 2015. Depreciation expense is included in administrative expenses. There were no purchases of investments. Required: a) Prepare a statement of cash flows for 2015 using the indirect method. Prepare all required disclosures. b) Prepare the operating section of the statement of cash flows using the direct method. ***** Question 2 (20 marks) Black Rock Resorts Inc. had the following financial statements for the year ended December 31, 2013: Additional information: During 2013, the company issued a 10% stock dividend to its common stockholders. The common shares were trading for $8 each on the date following the transaction. Immediately prior to the stock dividend, there were 85,000 common shares outstanding. During 2013, the company issued 7,600 common shares in exchange for a plot of land. The value of the land was appraised at $42,000 at the time of its acquisition. The company purchased additional land for $10,000 cash. On July 1, immediately after paying the semi-annual interest, the company retired bonds with a face value of $50,000. The company did not buy or sell any investments during the year. The other comprehensive income arose from the revaluation of the investments, net of the applicable deferred income taxes of $1,000. The company sold some equipment which cost $53,000. The company also purchased additional equipment for cash during the year. The company paid a cash dividend during the year. There was no interest payable at either the beginning or end of the year. Required: Prepare, in good form, a statement of cash flows for Black Rock Resorts Inc. for the year ended December 31, 2013. Use the indirect method to present the operating activities section. Provide any required disclosures that are not shown on the face of your statement of cash flows. The company elects to include interest received and paid and dividends received in cash flows from operations and dividends paid in cash flows from financing. END OF ASSIGNMENT