When composing a statement of cash flows, how do you determine what entries from thebalance sheet or income statementshould be included. I will attach what I have so far. I am totally lost...

3-14 1.) Net working capital = Current assets - current liabilities 2014 $1000 2015 $900 Debt ratio = total liabilities/total assets 2014 800/2400 = 33% 2015 900/2600 = 35% 2.) Common-sized income statement Sales Cost of goods sold Gross profit Operating expenses: Selling and general and Administrative expenses Depreciation expense Total operating expenses Operating income (earnings before Interest and taxes) Interest expense Income before taxes (taxable income) Income tax expense (40%) Net income (earnings available to Common shareholders) 360 1450 (850) 600 100% (41.4%) 58.6% (40) 200 (240) (2.8%) 13.8% (16.6%) 24.8% 64 296 (118) 178 4.4% 20.4% (8.1%) 12.3% Common-sized balance sheet Assets: Cash Accounts receivable Inventory Current assets Plant and equipment Less accumulated depreciation Net plant and equipment Total assets Liabilities and Equity: Accounts payable Notes payable-current (9%) Current liabilities Bonds Owner's equity Common stock Retained earnings Total owner's equity Total liabilities $150 425 5.8% 16.3% 625 $1200 $2600 (1200) 1400 2600 24.0% 46.2% 100.0% (-46.2%) 53.8% 100.0% 150 150 $300 $600 5.8% 5.8% 11.5% 23.1% $ 900 800 $1700 $2600 34.6% 30.8% 65.4% 100.0% Statement of cash flows Operating income Depreciation Expense Income Taxes After-tax cash flows from operations Increase in working capital: current assets Increase in accounts payable Change in long term assets: Decrease in fixed assets Free cash flows $360 ($200) ($118) $442 0 (50)