Use the following data to construct a statement of cash flows for MNO Company, using:

5.1 The direct method

5.2 The indirect method

Income statement for MNO Company for year 2000

Sales $200,000

Cost of goods sold (123,000)

Depreciation expense (15,000)

Insurance expense (11,000)

Wage expense (50,000)

Net income $ 1,000

Additional information:

• During year 2000, MNO declared and paid dividends of $2,500.
• Also, during year 2000, MNO paid $46,000 in cash to acquire new fixed assets.
• The accounts payable was used only for inventory.
• No debt was retired during year 2000.

Balance Sheet for MNO Company for years 2000 and 1999 2000 Cash $4,000 Accounts receivable 25,000 Prepaid insurance 5,000 Inventory 37,000 Fixed assets 316,000 Accumulated Depreciation (45,000) Total assets 342.000 1999 $14,000 32,500 7,000 34,000 270,000 (30,000) 327,500 Accounts payable Wages payable Note payable Capital stock Retained earnings Total Liabilities & Equity $18,000 4,000 173,000 88,000 59.000 342.000 $16,000 7,000 160,000 84,000 60,500 327.500 Page 3 of 3