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Exercise 11-45 (Algorithmic) Partial Statement of Cash Flows

Service Company had net income during the current year of $118,000. The following information was obtained from the balance sheet of Service Company:

Accounts receivable	$22,400	increase
Inventory	28,700	increase
Accounts payable	14,240	decrease
Interest payable	3,180	increase
Accumulated depreciation, building	12,340	increase
Accumulated depreciation, equipment	27,800	increase

Additional Information:

1. Equipment with accumulated depreciation of $15,000 was sold during the year.
2. Cash dividends of $36,000 were paid during the year.

Required:

Prepare the net cash flows from operating activities using the indirect method. Use a minus sign to indicate any decreases in cash or cash outflows.

Service Company
Net Cash Flows from Operating Activities
Using Indirect Method
Cash flows from operating activities:
Net income		$fill in the blank 2
Adjustments to reconcile net income to net cash flow from operating activities:
Increase in accounts receivable	fill in the blank 4
Decrease in accounts receivable	fill in the blank 6
Decrease in inventory	fill in the blank 8
Increase in interest payable	fill in the blank 10
Decrease in interest payable	fill in the blank 12
Accumulated depreciation	fill in the blank 14	fill in the blank 15
Net cash provided by operating activities		$fill in the blank 16

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