statement of cash flows using the direct method

Exercise 23-13 Sage Inc., a greeting card company, had the following statements prepared as of December 31, 2017 SAGE INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016 Cash Accounts receivable Short-term debt investments (available-for-sale) Inventory Prepaid rent Equipment Accumulated depreciation-equipment Copyrights Total assets 12/31/17 12/31/16 $6,000 $7,100 61,400 51,500 34,600 18,000 40,300 60,200 4,900 4,000 152,400 130,600 (34,800) (25,200 ) 45,700 49,800 $310,500 $296,000 Accounts payable Income taxes payable Salaries and wages payable Short-term loans payable Long-term loans payable Common stock, $10 par Contributed capital, common stock Retained earnings Total liabilities & stockholders' equity $46,100 4,000 7,900 8,100 59,700 100,000 30,000 54,700 $310,500 $40,300 6,000 4,000 10,000 69,600 100,000 30,000 36,100 $296,000 SAGE INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2017 Sales revenue Cost of goods sold Gross profit Operating expenses Operating income Interest expense $11,600 Gain on sale of equipment 2,000 Income before tax Income tax expense Net income $333,450 174,300 159,150 118,800 40,350 9,600 30,750 6,150 $24,600 Additional information: 1. Dividends in the amount of $6,000 were declared and paid during 2017. 2. Depreciation expense and amortization expense are included in operating expenses. 3. No unrealized gains or losses have occurred on the investments during the year. 4. Equipment that had a cost of $19,800 and was 70% depreciated was sold during 2017. Prepare a statement of cash flows using the direct method. (Show amounts that decrease cash flow with either a - sion SAGE INC. Statement of Cash Flows For the Year Ended December 31, 2017 V Cash Flows from Operating Activities Prepare a statement of cash flows using the direct method. (Show amounts that decrease cash flow with either a - slan SAGE INC. Statement of Cash Flows For the Year Ended December 31, 2017 V Cash Flows from Operating Activities Cash Received from Customers 323,500 Cash Payments to Suppliers -148,600 Cash Payments for Operating Expenses -88,240 Cash Payments for Interest -11,600 Cash Payments for Income Taxes -8,150 -256,590 Net Cash Provided by Operating Activities 66,910 Cash Flows from Investing Activities Sale of Equipment 7,940 Purchase of Equipment -21,800 Durchase of Investments -16.600 Cash Flows from Investing Activities Sale of Equipment 7,940 Purchase of Equipment -21,800 Purchase of Investments -16,600 Net Cash Used by Investing Activities -30,460 Cash Flows from Financing Activities Principal Payment on Short-term Loan V -1,900 Principal Payment on Long-term Loan v -9,900 -6,000 Dividend Payments -17,800 Net Cash Used by Financing Activities 7,100 Cash at Beginning of Period 6,000 Cash at End of Period