Problem 2 Statement of cash flows The information shown belo

Problem 2 Statement of cash flows. The information shown below is taken from the accounts of Waverly Corporation for the year ended December 31, 2017 Net income Amortization of patent Proceeds from issuance of common stock Decrease in inventory Sale of building at a $15,000 gain Decrease in accounts payable Purchase of equipment Payment of cash dividends Depreciation expense Decrease in accounts receivable Payment of mortgage Increase in short-term notes payable Sale of land at a $5,000 loss Purchase of delivery van Cash at beginning of year $314,000 12,000 103,000 27,000 85,000 15,000 185,000 24,000 55,000 23,000 75,000 8,000 40,000 33,000 205,000 Instructions Prepare a statement of cash flows for Robinson corporation for the year ended December 31, 2017.

Solution

Statement of cash flow :

Cash flow from operating activities
Net income		314000
Adjustment to reconcile net income
Depreciation expense	55000
Amortization of patent	12000
Decrease inventory	27000
Decrease account payable	-15000
Decrease account receivable	23000
Increase short term note payable	8000
Net cash flow from operating activities		424000
Cash flow from investing activities
Sale of building	85000
Purchase equipment	-185000
Sale of land	40000
Purchase of delivery van	-33000
Net cash flow from investing activities		-93000
Cash flow from financing activities
Issue common stock	103000
Payment of cash dividend	-24000
Payment of mortgage	-75000
Net cash flow from financing activities		4000
Net cash flow		335000
Beginning cash		205000
Ending cash		540000