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(Working with a statement of cash flows) Given the balance sheet, 3 , and income statement, prepare a statement of cash flows for Abrahams Manufacturing Company for the year ended January 31, 2018. Additional Information 1. The only entry in the accumulated depreciation account is for 2018 depreciation. 2. The firm paid $22,052 in common stock dividends during 2018. Complete the operating activities part of the statement of cash flows: (Round to the nearest dollar. NOTE: Input cash inflows as positive values and cash outflows as negative values.) Statement of Cash Flows Cash Flows from Operating Activities Net income $ Adjustments Depreciation M Increase in accounts receivable Decrease in inventory Increase in account payable Decrease in accrued liabilities Net cash provided by operating activities $ Complete the investing activities part of the statement of cash flows: (Round to the nearest dollar. NOTE: Input cash inflows as positive values and cash outflows as negative values.) Statement of Cash Flows (Cont'd) Cash Flows from Investing Activities Increase in gross plant and equipment Net cash used in investing activities $ Complete the financing activities part of the statement of cash flows: (Round to the nearest dollar. NOTE: Input cash inflows as positive values and cash outflows as negative values.) Statement of Cash Flows (Cont'd) Cash Flows from Financing Activities Decrease in mortgage payable Increase in preferred stock $ Dividends Net cash provided by financing activities Net increase in cash Cash, February 1, 2018 Cash, January 31, 2018 Abrahams Manufacturing Company Income Statement for the Year Ended 1/31/2018 2018 Sales $ 189,000 55,000 Cost of goods sold Gross profit $ 134,000 Selling, general and administrative expenses 43,000 29,000 Depreciation expense Operating income $ 62,000 3,100 Interest expense Earnings before taxes $ 58,900 Taxes 18,848 15,000 Preferred stock dividends $ 25,052 Earnings available to common stockholders Abrahams Manufacturing Company Balance Sheet for 1/31/2017 and 1/31/2018 2017 2018 Cash $ 89,000 $ 115,000 Accounts receivable 69,000 Inventory 64,000 112,000 10,000 96,000 10,000 Prepaid expenses Total current assets $ 275,000 $ 290,000 Gross plant and equipment 238,000 (40,000) 314,000 (69,000) Accumulated depreciation $ 473,000 $ 535,000 Total assets Accounts payable $ $ 85,000 68,000 94,000 59,000 Accrued liabilities Total current debt $ 153,000 $ 153,000 Mortgage payable 70,000 0 Preferred stock 0 129,000 Common stock 205,000 45,000 205,000 48,000 Retained earnings $ 473,000 Total debt and equity $ 535,000
