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Santana Rey, owner of Business Solutions, decides to prepare a statement of cash flows for her business using the following financial data. BUSINESS SOLUTIONS
Santana Rey, owner of Business Solutions, decides to prepare a statement of cash flows for her business using the following financial data. BUSINESS SOLUTIONS Income Statement For Three Months Ended March 31, 2021 Computer services revenue $ 24,907 Net sales Total revenue 18,293 43,200 Cost of goods sold Depreciation expense-Office equipment $ 14,552 320 1,150 Depreciation expense-Computer equipment Wages expense Insurance expense Rent expense Computer supplies expense Advertising expense Mileage expense Repairs expense-Computer Total expenses Net income Assets Cash Accounts receivable Inventory Computer supplies Prepaid insurance Prepaid rent 3,050 535 1,875 1,285 510 320 890 BUSINESS SOLUTIONS Comparative Balance Sheets Total current assets Office equipment Accumulated depreciation-Office equipment Computer equipment Accumulated depreciation-Computer equipment Total assets Liabilities and Equity Accounts payable Wages payable Unearned computer service revenue Total current liabilities Equity Common stock Retained earnings Total liabilities and equity 24,487 $ 18,713 2021 March 31, December 31, 2020 $ 75,427 23,867 $ 55,172 5,468 664 0 2,015 480 1,030 1,605 745 745 103,748 63,470 7,500 7,500 (640) (320) 19,900 (2,300) 19,900 (1,150) $ 128,208 $ 89,400 $ 0 $ 1,100 935 0 935 540 1,500 3,140 105,000 22,273 78,000 8,260 $ 128,208 $ 89,400 Required: Prepare a statement of cash flows for Business Solutions using the indirect method for the three months ended March 31, 2021. Owner Santana Rey contributed $27,000 to the business in exchange for additional stock in the first quarter of 2021 and has received $4,700 in cash dividends. Note: Amounts to be deducted should be indicated with a minus sign. Cash flows from operating activities BUSINESS SOLUTIONS Statement of Cash Flows (Indirect) For Quarter Ended March 31, 2021 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current assets and current liabilities Cash flows from investing activities Net cash used in investing activities Cash flows from financing activities Cash balance at December 31, 2020 Cash balance at March 31, 2021
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