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The income statement and additional data of Newman Travel Products, Inc., follow: (Click the icon to view the income statement.) Requirements (Click the icon to
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The income statement and additional data of Newman Travel Products, Inc., follow: (Click the icon to view the income statement.) Requirements (Click the icon to view the additional data.) 1. Prepare Newman's statement of cash flows for the year ended December 31, 2021, using the indirect method. 2. Evaluate the company's cash flows for the year. In your evaluation, mention all three categories of cash flows and give the rationale for your evaluation. Start by completing the cash flows from operating activities. Then complete each section of the statement of cash flows, including the noncash investing and financing activities. (Use parentheses or a minus sign for numbers to be subtracted and for a net decrease in cash.) Newman Travel Products, Inc. Statement of Cash Flows (Indirect Method) Year Ended December 31, 2021 Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash provided by (used for) operating activities: Depreciation Decrease in accounts receivable Decrease in inventory Increase in prepaid expenses Increase in accounts payable Decrease in accrued liabilities Net cash provided by (used for) operating activities $ 27,000 $ 91,800 Data table Newman Travel Products, Inc. Income Statement Year Ended December 31, 2021 Revenues: Service revenue Dividend revenue $ 279,000 8,600 $ 287,600 Expenses: Cost of goods sold 97,000 Salary expense 57,000 Depreciation expense 27,000 Advertising expense 3,500 Interest expense 2,300 9,000 195,800 Income tax expense $ 91,800 Net income More info Additional data: a. Acquisition of plant assets was $211,000. Of this amount, $160,000 was paid in cash and $51,000 was financed by signing a note payable. b. Proceeds from the sale of land totaled $45,000. c. Proceeds from the issuance of common stock totaled $47,000. d. Payment of a long-term note payable was $12,000. e. Payment of dividends was $15,000. f. From the balance sheets: Current assets: December 31, 2021 2020 Cash 100,000 $ 53,000 Accounts receivable 48,000 60,000 Inventory 29,000 84,000 Prepaid expenses 9,800 9,000 Current liabilities: Accounts payable 33,000 13,000 Accrued liabilities 36,000 99,000
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