Additional information A cash dividend of 35780 was declared

Additional information:

A cash dividend of €35,780 was declared and paid during the year.

Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

1.		New equipment costing €80,920 was purchased for cash during the year.
2.		Old equipment having an original cost of €58,250 and accumulated depreciation of 51,000 was sold for €12,600 cash.
3.		Bonds payable matured and were paid off at face value for cash.
4.		A cash dividend of €35,780 was declared and paid during the year.

Solution

Cash flows from operating activities net income 171690 Adjustments to reconcile net income to net cash provided by operating activities decrease in accured expenses payable -1420 increase in inventory -9770 increase in accounts receivable -58790 Depreciation expense 47,290 Gain on disposal of plant assets -5350 increase in prepaid expense -4210 increase in accounts payable 44080 11,830 Net cash provided by operating activities 183520 Cash flows from investing activities purchase of Equipment -80,920 sale of Equipment 12600 purchase of long term investment -25920 net cash used by investing activities -94240 Cash flows from financing activities Redemption of bonds -29350 cash from stock issue 45610 cash dividend -35780 net cash used by financing activities -19520 Net increase in cash 69760 Cash at beginning of period 47040 cash at year end 116800