The net income reported on the income statement for the current year was $203,000. Depreciation recorded on equipment and a building amounted to $60,700 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows:

	End of Year		Beginning of Year
Cash	$56,030		$58,830
Accounts receivable (net)	71,050		72,600
Inventories	140,080		125,070
Prepaid expenses	7,790		8,300
Accounts payable (merchandise creditors)	62,590		65,650
Salaries payable	9,020		8,180

Question Content Area

a. Prepare the "Cash Flows from Operating Activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

b. If the direct method had been used, would the net cash flow from operating activities have been the same?

Treasury Stock Transactions Mystic Lake Inc. bottles and distributes spring water. On July 9 of the current year, Mystic Lake reacquired 4,900 shares of its common stock at $72 per share. On September 22, Mystic Lake sold 3,400 of the reacquired shares at $80 per share. The remaining 1,500 shares were sold at $68 per share on 23. a. Journalize the transactions of July 9, September 22, and November 23. If an amount box does not require an entry, leave it blank. b. What is the balance in Paid-In Capital from Sale of Treasury Stock on December 31 of the current year? c. For what reasons might Mystic Lake Inc. have purchased the treasury stock