Question 1 (Statement of Cash flows)
Instruction:
(A) Use the following information from Global Inc, to prepare the statement of cash flows for year ended
December 31, 2021; for operating activities, using the indirect method.
Account title Balance at year end 2020 Balance at year end 2021
Cash $60,000 $122,265
Accounts receivable 32,000 33,800
Inventories 40,525 37,850
Accounts payable 39,890 39,000
Prepaid rent 32,000 42,000
Salaries payable 29,000 39,500
Other information:
1.) Net income for the year was $33,450.
2.) Depreciation expense was $8,000.
3.) Cash dividend paid $2,125.
4.) Cash received from a loan to borrower $9,000.
5.) Repayment of a loan borrowed from Hong Kong Bank $2,780.
6.) Issued a note payable to Hong Kong Bank in exchange of cash $ 6,235.
7.) Issued capital stock to shareholders for $10,000.