Tuit Inc a greeting card company that follows ASPE had

#1591

Tuit Inc., a greeting card company that follows ASPE, had the following statements prepared as
of December 31, 2014:

Additional information:

1. Dividends on common shares in the amount of $6,000 were declared and paid during 2014.

2. Depreciation expense is included in operating expenses, as are salaries and wages expense
of $69,000.
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 3. Equipment with a cost of $20,000 that was 70% depreciated was sold during 2014.

Instructions

(a) Prepare a statement of cash flows using the direct method.

(b) Prepare a statement of cash flows using the indirect method.

(c) Does Tuit Inc., have any options on how to classify interest and dividends paid on the
statement of cash flows?

(d) From the perspective of an investor who is interested in investing in mature, successful
companies, comment on Tuit Inc.'s sources and uses of cash by analyzing the company's
statement of cash flows.

Tuit Inc a greeting card company that follows ASPE had

ANSWER
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