Solution-List errors you find in the following statement of

List errors you find in the following statement of cash flow

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Reference no: EM131063354

Statement of cash flows-indirect method

List the errors you find in the following statement of cash flows. The cash balance at the beginning of the year was $240,000. All other amounts are correct, except the cash balance at the end of the year.

Shasta Inc. Statement of Cash Flows
For the Year Ended December 31, 2016
Cash flows from operating activities:
Net income	$360,000
Adjustments to reconcile net income to net
cash flow from operating activities:
Depreciation	100,800
Gain on sale of investments	17,280
Changes in current operating assets and liabilities:
Increase in accounts receivable	27,360
Increase in inventories	(36,000)
Increase in accounts payable	(3,600)
Decrease in accrued expenses payable	(2,400)
Net cash flow from operating activities		$ 463,440

Cash flows from investing activities:
Cash received from sale of investments		$240,000
Less: Cash paid for purchase of land	$259,200
Cash paid for purchase of equipment	432,000	691,200
Net cash flow used for investing activities			(415,200)
Cash flows from financing activities:
Cash received from sale of common stock		$312,000
Cash paid for dividends		132,000
Net cash flow from financing			180,000
Increase in cash			$ 47,760
Cash at the end of the year			192,240
Cash at the beginning of the year			$240,000

Reference no: EM131063354

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List errors you find in the following statement of cash flow

Reference no: EM131063354

Reference no: EM131063354

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