Question 2 (3 Marks)

Case 1Use the following calendar-year information to prepare Fairchild's SAOperating activitiesandFinancing activitiesof the statement of cash flows using the direct method.

Increase in accounts receivable 120,000

Increase in taxes payable 40,000

Increase in long term notes payable 20,000

Increase in land 140,000

Decrease in Mortgage payable 50,000

Increase in equity 80,000

Decrease in accrued taxes payable

Increase in cash 60,000

Decrease in wages payable

Dividends paid 12,000

Answer