Statement of Cash Flows (Indirect Method) Use the following information regarding the Newcastle Corporation to prepare a statement of cash flows using the indirect method: Accounts payable decrease $8,000 Accounts receivable increase 11,200 Wages payable decrease 4,800 Amortization expense 25,600 Cash balance, January 1 48,000 Cash balance, December 31 11,200 Cash paid as dividends 9,600 Cash paid to purchase land 160,000 Cash paid to retire bonds payable at par 120,000 Cash received from issuance of common stock 72,000 Cash received from sale of equipment 19,200 Depreciation expense 62.400 Gain on sale of equipment 22.40 Inventory increase 20,800 Net income 153,600 Prepaid expenses increase 12,800 Remember to use negative signs with answers when appropriate. NEWCASTLE CORPORATION Statement of Cash Flows For Year Ended December 31 Cash Flow from Operating Activities Net Income $ Add (deduct) items to convert net income to cash basis Depreciation Amortization Gain on Sale of Equipment Accounts Receivable Increase Inventory Increase Prepaid Expenses increase Accounts Payable Decrease Med from cance of common stock Cash received from sale of equipment Depreciation expense Gain on sale of equipment Inventory increase Net income Prepaid expenses increase 72,000 19,200 62,400 22.400 20,800 153,600 12,800 Remember to use negative signs with answers when appropriate NEWCASTLE CORPORATION Statement of Cash Flows For Year Ended December 31 Cash Flow from Operating Activities Net Income Add(deduct) items to convert net income to cash basis Depreciation Amortization Gain on Sale of Equipment Accounts Receivable increase Inventory Increase Prepaid Expenses increase Accounts Payable Decrease Wages Payable Decrease Cash Flow Provided by Operating Activities Cash Flow from Investing Activities Sale of Equipment Purchase of Land Cash Used by Investing Activities Cash Flow from Financing Activities Issuance of Common Stock Retirement of Bonds Payable Payment of Dividends Cash Used by Financing Activities Net Decrease in Cash Cash at Beginning of Year