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Make a statement of cash flows using the indirect method.

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Reference no: EM132525910

Comparative balance sheets for Ehub BD Ltd are presented below.

EHub BD Ltd

Comparative Balance Sheet

Decemebr 31

Assets                                        2017                           2016

Cash                                  73000                     22000

Accoutns Receivable              85000                   76000

Inventory                            180000                    189000

Land                                    75000                   100000

Equipemnt                           250000                 200000

Accu Dep - Equipment           (66,000)                (42,000)

Total                                    597000                   545000

Liability and Equity

Accounts Payable                      34000                    47000

Bonds Payable                         150000                   200000

Common Stock ($1 Par )             214000                   164000

Retained Earnings                         199000                 134000

Total                                          597000                545000

Additional information:

1. Net income for 2017 was $135,000.

2. Cash dividends of $70,000 were declared and paid.

3. Bonds payable amounting to $50,000 were redeemed for cash $50,000.

4. Common stock was issued for $50,000 cash.

5. Depreciation expense was $24,000.

6. Sales revenue for the year was $978,000.

7. Land was sold at cost, and equipment was purchased for cash.

Instructions

Question a. Make a statement of cash flows for 2017 using the indirect method.

Question b. Comment on the quality of income of the company.

Question c. Comment on investing and financing cash flows of the company.

Reference no: EM132525910

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