The income statement and additional data of Value World, Inc., follow:

Additional data:
a. Collections from customers are $25,000 less than sales.
b. Payments to suppliers are $1,600 more than the sum of cost of goods sold plus advertising expense.
c. Payments to employees are $2,400 more than salary expense.
d. Dividend revenue, interest expense, and income tax expense equal their cash amounts.
e. Acquisition of plant assets is $209,000. Of this amount, $109,000 is paid in cash and $100,000 by signing a long-term note payable.
f. Proceeds from sale of land total $27,000.
g. Proceeds from issuance of common stock total $93,000.
h. Payment of long-term note payable is $17,000.
i. Payment of dividends is $9,000.
j. Cash balance, September 30, 2011, was $10,000.

Requirements
1. Prepare Value World, Inc.€™s statement of cash flows and accompanying schedule of non-cash investing and financing activities. Report operating activities by the direct method.
2. Evaluate Value World€™s cash flows for the year. In your evaluation, mention all three categories of cash flows and give the reason for yourevaluation.

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Value World, Inc. Income Statement Year Ended September 30, 2012 Revenues: $255,000 Sales revenue Dividend revenue 9.500 $264.500 Expenses: Cost of goods sold Salary expense 101,000 43,000 27,000 10,500 2,200 11,500 n expense Advertising expense Interest expense Income tax expense 195,200 S 69,300 Net income