Chapter 10
The Statement of Cash Flow
508
AP-3B (
2
)
The net income for the year ended December 31, 2016 for Kersley Company was $73,000.
Additional information is shown below.
Interest expense on borrowing
$8,000
Increase in accounts receivable
10,000
Decrease in prepaid expense
3,000
Decrease in accounts payable
4,000
Dividends paid to common shareholders
14,000
Calculate the increase (decrease) in cash from operating activities.
AP-4B (
2
)
Use the following information to prepare the operating activities section of a cash flow
statement for MNO Co. for 2016 using the indirect method.
Net income
$140,000
Increase in inventory
30,000
Increase in accounts payable
20,000
Depreciation expense
55,000
Increase in accounts receivable
18,000
Gain on sale of land
25,000
