The following selected account balances are taken from

the financial #1597

The following selected account balances are taken from the financial statements of Mandrich
Inc. at year end prepared using IFRS:

2014............2013__

Preferred shares classified as equity.......................................$145,000........$145,000

Common shares: 9,000 shares in 2014, 10,000 shares in 2013..........142,000.........160,000

Contributed surplus-reacquisition of common shares.....................3,500..............-0-

Cash dividends-preferred.....................................................6,250.............6,250

Stock dividends-common...................................................14,000.............4,000

Retained earnings (balance after closing entries) ........................300,000..........240,000

At December 31, 2014, the following information is available:

1. Mandrich Inc. repurchased 2,000 common shares during 2014. The repurchased shares had
a weighted average cost of $32,000.

2. During 2014, 1,000 common shares were issued as a stock dividend.

3. Mandrich Inc. chooses to classify dividends paid as financing activities.

Instructions

(a) Calculate net income for the fiscal year ending December 31, 2014.

(b) Provide the necessary disclosure for all of Mandrich Inc.'s transactions on the statement of
cash flows. Also state the section of the statement of cash flows in which each item is reported.
Where there are choices or options in the classification, provide details of the options available.

(c) Does Mandrich Inc. have other choices in classifying dividends paid on the statement of
cash flows?

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 The following selected account balances are taken from the financial

ANSWER
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