Statement of Cash Flows-Direct Method The comparative balance sheet of Canace Products Inc. for December 31, 2016 and 2045, is as follows: Dec. 31, 20Y6 Dec. 31, 2045 $233,660 Cash Accounts receivable (net) Inventories $249,180 90,270 254,820 83,920 Investments 248,480 96,260 Land Equipment Accumulated depreciation equipment 130,700 281,150 (65,820) $940,300 219,680 (59,240) $822,760 Total assets Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Dividends payable Common stock, $10 par Paid-in capital: Excess of issue price over par-common stock Retained earnings $170,190 16,930 9,400 50,780 190,880 502,120 $940,300 $162,080 21,390 7,400 40,320 111,900 479,670 $822,760 Total liabilities and stockholders' equity The income statement for the year ended December 31, 2016, is as follows: Check My Work The income statement for the year ended December 31, 2016, is as follows: Sales Cost of merchandise sold $1,346,910 Gross profit 554,600 Operating expenses: $792,310 Depreciation expense $6,580 Other operating expenses 699,520 Total operating expenses Operating income 706,100 $86,210 Other expense: Loss on sale of investments (25.990) Income before income tax $60.220 Income tax expense 19.270 Net Income $40.950 Additional data obtained from an examination of the accounts in the ledger for 2016 are as follows: a. Equipment and land were acquired for cash, b. There were no disposals of equipment during the year. C. The investments were sold for $70,270 cash d. The common stock was issued for cash. e. There was a $18,500 debit to Retained Earnings for cash dividends declared, Required: Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Canace Products Inc. Statement of Cash Flows For the Year Ended December 31, 2046 Cash flows from operating activities: Cash received from customers 1,340,560 Cash payments for merchandise Cash payments for operating expenses Ju dul Cash payments for income taxes Net cash flow from operating activities Cash flows from (used for) investing activities: Cash from sale of investments Cash used for purchase of land Cash used for purchase of equipment Net cash flow used for investing activities Cash flows from (used for) financing activities Cash from sale of common stock Cash used for dividends Net cash flow from financing activities Increase in cash Cash at the beginning of the year Cash at the end of the year
