Cash Flow Statement Problem 2

Cash Flow Statement of Gamma Corporation for the year ending June 30, 2010
Cash Flow from Operating Activities (using Indirect Method)
Profit before tax 48100
Adjustments for non-cash and non-operating items
+ Interest Expense 2800
+ Depreciation 38600 41400
Operating Profit before Working Capital Changes 89500
W. Capital Changes
Decrease in Receivables 10000 Reconcilation of Balance She
Decrease in Inventory 10000 Furniture
Increase in Prepaid Expenses -1200 O/P Furniute
Decrease in Accounts Payable -2000 Add: Purchase of Furniture
Decrease in Income taxes payable -1200 15600
CFO before tax 105100 Less: Sale of Furniture
Less: Income Tax -12300
Cash flow from operating activities (A) 92800
Notes Payable
Cash Flow from Investing Activities O/P Notes
Sale of Furniture (54000-30600) 23400 Add: Issue of Notes Payable
Cash flow from investing activities (B) 23400
Less: Repayment of Notes
Cash Flow from Financing Activities
Repayment of notes payables -40000
Issue of shares 50000 Common Stock
Payment of dividend -8600 O/P Common Stock
Interest payment -2800 Add: Issue of Stock
Cash from FInancing Activities (C) -1400
Total Cash Flows (A + B + C) 114800
Add: Opening Cash Balance 25000
Closing cash balance 139800 which is equal to the cash balance in th
Reconcilation of Balance Sheet Items

O/P Furniute 120000

Add: Purchase of Furniture 44000
164000
Less: Sale of Furniture -54000
Closing Furniture 110000

Notes Payable
70000
Add: Issue of Notes Payable 44000
114000
Less: Repayment of Notes -40000
Closing Notes Payabl 74000

Common Stock
O/P Common Stock 180000
Add: Issue of Stock 50000
Closing Common stoc 230000

qual to the cash balance in the closing balance sheet