Business School Cash Flow Statementdirect method 20 The fal

Business School \". Cash Flow Statement-direct method (20%) The fallowing information is available for sericho Corporation for the ysear ended 31 December 2017 Collections on loans made to bonowers Loans made to bonowers Intcrest and dividends received Interest paid Income taxes paid Dividends paid Payments to retire honds payable Payments to settle short-term debts Cash received from customers Cash paid to suppliers and employces Proceeds from issuing capital stock $104500 $229000 21.500 91 500 $179,000 $1.709900 1954500 Purchases of plant assets Proceeds from sales of plant asscts Cash and cash equivalents, beginning of year $684,000 $329.900 $81,500 On the basis of the above information, prepare a statement of cash flows for Jericho Corporation, showing the computation of net cash flows from operating activities by the direct method

Solution

Statement of cash flow Cash flows from operating activities Cash received from customers 1709000 Cash paid to supplier and employees -1054000 Income taxes paid -91500 Interest paid -21500 542000 Net cash from operating activities       542,000.00 Cash flows from investing activities Purchase of Plant assets -684000 Proceeds from sale of Plant Assets 329000 Interest and dividend received 24000 Loan made to Borrowers -229000 Collection on loan made to borrowers 104000 -560000 Net cash used investing activities     (560,000.00) Cash flows from financing activities Payment to settle short term debt -474000 Proceeds from Issuing of Common stock 254000 Payment to retire Bonds payable -179000 Dividend paid -44000       (443,000.00) Net cash from financing activities     (443,000.00) Net Increase in cash and cash equivalents (461,000.00) Cash and cash equivalents at beginning of period       81,500.00 Ending Balance        (379,500.00) If any doubt please comment