Use the income statement of Cobbs Hill Consulting Ltd. plus these additional data during the fiscal year 2020:

Required 1. Prepare Cobbs Hill Consulting Ltd.'s cash flow statement for the year ended September 30, 2020, using the indirect method.

Required 2. Evaluate Cobbs Hill Consulting Ltd.'s cash flows for the year. In your evaluation, mention all three categories of cash flows, and give the reason for your evaluation.

Additional data: a. Acquisition of computer equipment was $236,000. Of this amount, $208,000 was paid in cash and $28,000 by signing a long-term note payable. Cobbs Hill Consulting Ltd. sold no computer equipment during fiscal year 2020. b. Cash received from sale of land, $29,000. c. Cash receipts from issuance of common shares, $88,000. d. Payment of long-term note payable, $58,000. e. Payment of dividends, $134,000. f. Change in cash balance, S?. g. From the comparative balance sheet at September 30: Cobbs Hill Consulting Ltd. Balance Sheet (partial) September 30, 2020 and 2019 2020 2019 Current assets Cash Accounts receivable Office supplies Prepaid expenses $ 46,500||$ 40,000 18,000 150,000 20,000 14,000 28,000 28,000 b. Cash received from sale of land, $29,000. c. Cash receipts from issuance of common shares, $88,000. d. Payment of long-term note payable, $58,000. e. Payment of dividends, $134,000. f. Change in cash balance, S?. g. From the comparative balance sheet at September 30: Cobbs Hill Consulting Ltd. Balance Sheet (partial) September 30, 2020 and 2019 2020 2019 Current assets Cash Accounts receivable Office supplies Prepaid expenses Current liabilities Accounts payable Accrued liabilities $ 46,500 $ 40,000 18,000 150,000 20,000 14,000 28,000 28,000 $ 72,000 $ 60,000 38,000 46,000 Cobbs Hill Consulting Ltd. Income Statement For the Year Ended September 30, 2020 $ 562,000 Revenues Consulting revenue Expenses Salaries expense Amortization expense Rent expense Office supplies expense Insurance expense Interest expense Income tax expense $ 308,000 58,000 24,000 20,000 8,500 4,000 38,000 460,500 $ 101,500 Net income Requirement 1. Prepare Cobbs Hill Consulting Ltd.'s cash flow statement for the year ended September 30, 2020, using the indirect method. (Use parentheses or a minus sign for numbers to be subtracted.) Cobbs Hill Consulting Ltd. Cash Flow Statement For the Year Ended September 30, 2020 Cash flows from operating activities Net income Add (subtract) items that affect net income and cash flow differently Amortization expense Decrease in accounts receivable Increase in office supplies Increase in accounts payable Decrease in accrued liabilities Net cash inflow from operating activities