Statement of Cash Flows The following items involve the cash flow activities of Rocky Horror Picture Co.: a. Net income, $43,900 b. Payment of dividends, $14,400 c. Ten-year, $35,000 bonds payable were issued at face value d. Depreciation expense, $10,800 e. Building acquired at a cost of $30,400 f. Accounts receivable decreased by $3,500 g. Accounts payable decreased by $4,100 h. Equipment acquired at a cost of $5,400 i. Inventories increased by $7,200 j. Beginning cash balance, $12,900 Required: Prepare Rocky Horror Picture's statement of cash flows using the indirect method. ROCKY HORROR PICTURE CO. Statement of Cash Flows For Year Ended December 31, Current Year Operating Activities: Net income 43,900 Adjustments for differences between net income and cash flows from operating activities: Depreciation expense 10,800 Decrease in accounts receivable 3,500 Increase in inventories -7,200 Decrease in accounts payable -4,100 Net cash provided by operating activities Investing Activities: Payment for purchase of building Operating Activities: Net income Statement of Cash Flows For Year Ended December 31, Current Year 43,900 V Adjustments for differences between net income and cash flows from operating activities: Depreciation expense 10,800 Decrease in accounts receivable 3,500 Increase in inventories -7,200 Decrease in accounts payable -4,100 Net cash provided by operating activities Investing Activities: Payment for purchase of building -30,400 Payment for purchase of equipment Net cash used for investing activities Financing Activities: -5,400 Payment of dividends Receipt from issuance of bonds Net cash provided by financing activities -14,400 35,000 Net increase in cash Cash, January 1 Cash, December 311 Feedback -35,800 20,600 12,900