Answer to CH 17 cash flow statement exercise on tutorial session:

Seaman –Young Corporation

Statement of cash Flows

For the Year Ended September 30, 19X4

Cash flows from operating activities:
Net income		93,900
Add (subtract)items that affect net income and cash flow differently:
Depreciation	8,500
Gain on sale of land	(10,900)
Decrease in accounts receivable	2,100
Increase in interest receivable	(1,300)
Increase in inventories	(4,800)
Decrease in Prepaid expense	700
Decrease in A/P`	(8,500)
Decrease in Income tax payable	(2,800)
Decrease in accrued liabilities	(11,200)
Increase in int. payable	1,300
Increase in salary payable	400	(26,500)
Net cash inflow from operating activities		67,400
Cash flows from investing activities:
Sale of land	38,100
Acquisition of long term investment	(37,300)
Net cash inflow from investing activities		800
Cash flows from financing activities
Payment of cash dividends	(64,300)
Issuance of common stocks	51,900
Payment of long term note payable	(24,700)
Net cash outflow from financing activities		(37,100)
Net increase in cash		31,100
Non-cash investing and financing activities :
Acquisition of equipment by issuing long-term note payable	26,300
Acquisition of equipment by issuing short-term note payable	22,000
Total noncash investing and financing activities	48,300

Direct methods:

Cash Flow from operating activities: Receipts:
Collection from customers [370,600 + 2,100( dec in A/R)]	372,700
Interest Received[ 7,300- 1,300( inc in Int/R)]	6,000
Total cash receipts:	378,700
Payments: To Suppliers
Inventory [ 161,500(COGS) + 8,500(dec A/P) +4,800(inc in Inv)]	174,800
Other operating expenses[ 29,600- 700(dec in prepaid exp) +11,200( dec in Acc.Liab)]	40,100
To employees[ 63,400- 400]	63,000
For interests[ 13,500-1300]	12,200
For Income tax[ 18,400+2,800]	21,200
Total cash payments	(311,300)
Net cash inflow from operating activities:	67,400