Using the indirect method P178A Data for Nosker Company are

P17-8A Data for Nosker Company are presented in P17-7A. Further analysis reveals the following. 1. Accounts payable pertain to merchandise suppliers. 2. All operating expenses except for depreciation were paid in cash. nstructions a) Prepare a statement of cash flows for Nosker Company using the direct method. b) Compute free cash flow. 17-9A Condensed financial data of Cheng Inc. follow. CHENG INC. Comparative Balance Sheets December 31 2016 2017 $ 80,800 Assets Cash Accounts receivable Inventory Prepaid expenses Investments Equipment Accumulated depreciation-equipment $ 48,400 92,800 117,500 28,400 143,000 270,000 (50,000) $682,500 33,000 102,850 26,000 114,000 242,500 (52,000) $514,750 Total Liabilities and Stockholders\' Equity Accounts payable Accrued expenses payable Bonds payable Common stock Retained earnings $67,300 17,000 $112,000 16,500 110,000 220.000 224,000 150,000 175,000 105,450 $514,750 Total $682,500 S1ARE

Solution

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Indirect
Cash Flow:
Cash Flow from operating Activities
Net Income		158900
Depreciation Expense		46500
Loss on disposal of plant asset		7500
Change in Current asset and current liabilities:
Increase in Accounts Receivable		-59800
Increase in inventory		-14650
Increase in Prepaid Expense		-2400
Increase in Accounts payable		44700
Decrease in Accrued Expense		-500
Cash Flow provided by operating Activities		180250
Cash Flow from investing activities
Purchase of investment		-29000
Purchase of New Equipment		-85000
Proceed from sale of equipment		1500
Cash Flow from investing activities		-112500
Cash Flow from financing activities
Sale of Capital Stock		45000
Sale of Bonds		-40000
Dividend Paid		-40350
Cash Flow from financing activities		-35350
Net Increase/(Decrease) in cash		32400
Cash, beginning		48400
Cash Ending		80800