Use the following information and state an Income Statement to calculate the net profit and a Statement of Cash Flows (identify each payment separately) for the month

Bank balance beginning of month

5,600

Inventory purchased for cash

28,000

Bank balance, end of month

9,800

Miscellaneous expenses paid

8,000

Cash drawings

20,000

Payment on accounts payable

44,000

Cash sales

72,000

Proceeds from bank loan

83,000

Collections from accounts receivable

32,000

Proceeds from sale of equipment

12,000

Cost of sales

64,000

Rent expense

800

Credit sales

46,000

Rent paid in advance for the next 6 months

4,800

Depreciation expense

3,500

Wages paid

22,000

Equipment purchased for cash

68,000

(d)What do the 3 sections of the Cash Flow Statement reveal about the firm?

For each of the 3 activities:

state whether the flow is positive or negative;

describe in words what the net cash flow for each of the 3 activities indicate and

state whether that is a "good" sign or a "not good" sign for the business.

Operating activities:

Investing activities:

Financing activities: