Seth Erkenbeck, a recent college graduate, has just completed the basic format t
ID: 2454169 • Letter: S
Question
Seth Erkenbeck, a recent college graduate, has just completed the basic format to be used in preparing the statement of cash flows (indirect method) for ATM Software Developers. All amounts are in thousands (000s). ATM SOFTWARE DEVELOPERS Statement of Cash Flows For the year ended December 31, 2015 Cash Flows from Operating Activities Net income Adjustments for noncash effects: Changes in current assets and current liabilities: Net cash flows from operating activities Cash Flows from Investing Activities Net cash flows from investing activities Cash Flows from Financing Activities Net cash flows from financing activities Net increase (decrease) in cash Cash at the beginning of the period $ 3,045 6,950 Cash at the end of the period $ 9,995 Listed below in random order are line items to be included in the statement of cash flows. Cash received from the sale of land Issuance of common stock Depreciation expense Increase in accounts receivable Decrease in accounts payable Issuance of long-term notes payable Purchase of equipment Decrease in inventory Decrease in prepaid rent Payment of dividends Net income Purchase of treasury stock $ 8,590 12,925 5,435 4,030 1,730 16,345 39,715 1,445 875 6,310 11,800 2,585 Required Prepare the statement of cash flows for ATM Software Developers using the indirect method. (List cash outflows and any decrease in cash as negative amounts. Enter your answers in thousands.)Explanation / Answer
ATM Software developers
Cash flow statement for the ended December 31 , 2015
Particulars Amount($)
Net income 11800
Adjustments:
Depreciation 5435
increase in accounts receivable (4030)
decrease in accounts payable (1730)
decrease in inventory 1445
decrease in prepaid rent 875
net cash flow from operating activities 13795
Cash flow from investing activities:
Sale of land 8590
Purchase of equipment (39715)
net cash flow from investing activities (17330)
Cash flow from financing activities:
Issuance of common stock 12925
dividend paid (6310)
purchase of treasury stock (2585)
issuance of long term notes payable 16345
net cash flow from financing activities 3045
cash beginning of the period 6950
cash ending of the period 9950.
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