You are the CFO for Tom & Jerry's, Inc. Together with Tom Fheelein and Jerry Rhodeint, the company's two shareholders, you are examining the following statement of cash flows which they prepared for Tom &Jerry's, Inc. for the year ended January 31, 2015 TOM & JERRYS'S, INC Statement of Cash Flows For the Year Ended Jasuary 31, 2015 $380,000 From sales of merchandise From sale of capital stock From sale of investment (purchased below)0,000 From depreciation From issuance of note for truck From interest en investments Total sources of cash 410,000 55,000 20,000 6.020 951.020 For purchase of fixtures and equipment For merchandise purchased for resale For purchase of investment For purchase of truck by issaance of note For purchase of treasury stock For interest on note payable Total uses of cash 320,000 258,000 For operating expenses (including depreciation) 160,000 75,000 20,000 10,000 3,000 846.000 Net increase in cash 5105,000 Tom claims that this statement of cash flows is an excellent portrayal of a superb first year increasing $105,000. Jerry replies that it was not a superb first year. Rather, he says, the year was an operating failure as the statement is presented incorrectly and $105,000 is not the actual increase in cash. The cash balance at the beginning of the year was $140,000. with cash A. Using the data provided, prepare a statement of cash flows using the indirect method. The noncash item in the income statement is depreciation. The purchase/sale of the investment and any resulting gain/loss are investing (not operating) activities. Hint: You may need to figure out net income for the year. only B. With whom do you agree, Tom or Jerry? Explain your position You are the CFO for Tom & Jerry's, Inc. Together with Tom Fheelein and Jerry Rhodeint, the company's two shareholders, you are examining the following statement of cash flows which they prepared for Tom &Jerry's, Inc. for the year ended January 31, 2015 TOM & JERRYS'S, INC Statement of Cash Flows For the Year Ended Jasuary 31, 2015 $380,000 From sales of merchandise From sale of capital stock From sale of investment (purchased below)0,000 From depreciation From issuance of note for truck From interest en investments Total sources of cash 410,000 55,000 20,000 6.020 951.020 For purchase of fixtures and equipment For merchandise purchased for resale For purchase of investment For purchase of truck by issaance of note For purchase of treasury stock For interest on note payable Total uses of cash 320,000 258,000 For operating expenses (including depreciation) 160,000 75,000 20,000 10,000 3,000 846.000 Net increase in cash 5105,000 Tom claims that this statement of cash flows is an excellent portrayal of a superb first year increasing $105,000. Jerry replies that it was not a superb first year. Rather, he says, the year was an operating failure as the statement is presented incorrectly and $105,000 is not the actual increase in cash. The cash balance at the beginning of the year was $140,000. with cash A. Using the data provided, prepare a statement of cash flows using the indirect method. The noncash item in the income statement is depreciation. The purchase/sale of the investment and any resulting gain/loss are investing (not operating) activities. Hint: You may need to figure out net income for the year. only B. With whom do you agree, Tom or Jerry? Explain your position