For the Year Ended December 31, 2018 ($ in thousands) Sales revenue Operating ex
ID: 2552466 • Letter: F
Question
For the Year Ended December 31, 2018 ($ in thousands) Sales revenue Operating expenses: $12,500 $ 4,500 350 650 2.900 Cost of goods sold Depreciation Insurance Administrative and other 8,400 4,100 1,640 $ 2,460 Total operating expenses Income before income taxes Income tax expense Net income Dec. 31,2018 Dec. 31, 2017 Balance Sheet Information ($ in thousands) AssetS: Cash Accounts receivable Inventory Prepaid insurance Plant and equipment $520 805 805 160 3,200 1,060 $ 310 940 710 75 2,350 710 Less: Accumulated depreciation Total assets $ 4,430 3,675 Liabilities and Shareholders' Equity: Accounts payable Payables for administrative and other expenses Income taxes payable Note payable (due 12/31/2019) Common stock Retained earnings $355 355 270 1,240 1,000 1,210 $ 4,430 $ 470 510 260 900 910 625 Total liabilities and shareholders' equity $ 3,675 Required: Prepare Tiger's statement of cash flows, using the indirect method to present cash flows from operating activities. (Hint: You will have to calculate dividend payments). (Enter your answers in thousands. Amounts to be deducted should be indicated with a minus sign.)Explanation / Answer
cash flow statement
Indirect method
net income
2460000
add depreciation
350000
changes in working capital
decrease in accounts receivable
135000
increase in inventory
-95000
increase in prepaid insurance
-85000
decrease in accounts payable
-115000
decrease in payable for administrative expenses
-155000
increase in income tax payable
10000
increase in notes payable
340000
cash flow from operating activities
2845000
cash flow from investing activities
purchase of equipment
-850000
cash flow from financing activities
-1785000
issuance of common stock
90000
payment of dividend
1875000
net cash flow from during the year
210000
add opening cash balance
310000
year end cash balance
520000
calculation of dividend payment
opening balance of retained earning
625000
add net income
2460000
less year end balance of retained earning
1210000
payment of dividend
1875000
cash flow statement
Indirect method
net income
2460000
add depreciation
350000
changes in working capital
decrease in accounts receivable
135000
increase in inventory
-95000
increase in prepaid insurance
-85000
decrease in accounts payable
-115000
decrease in payable for administrative expenses
-155000
increase in income tax payable
10000
increase in notes payable
340000
cash flow from operating activities
2845000
cash flow from investing activities
purchase of equipment
-850000
cash flow from financing activities
-1785000
issuance of common stock
90000
payment of dividend
1875000
net cash flow from during the year
210000
add opening cash balance
310000
year end cash balance
520000
calculation of dividend payment
opening balance of retained earning
625000
add net income
2460000
less year end balance of retained earning
1210000
payment of dividend
1875000