Question

Illies Corporation's comparative balance sheet appears below:

Comparative Balance Sheet
	Ending Balance			Beginning Balance
Assets:
Current assets:
Cash and cash equivalents	$	48,000		$	41,000
Accounts receivable		27,000			29,800
Inventory		75,000			77,800
Total current assets		150,000			148,600
Property, plant, and equipment		382,000			355,000
Less accumulated depreciation		172,000			140,000
Net property, plant, and equipment		210,000			215,000
Total assets	$	360,000		$	363,600
Liabilities and stockholders' equity:
Current liabilities:
Accounts payable	$	26,000		$	27,800
Accrued liabilities		62,000			67,800
Income taxes payable		57,600			50,000
Total current liabilities		145,600			145,600
Bonds payable		90,000			98,000
Total liabilities		235,600			243,600
Stockholders’ equity:
Common stock		35,000			30,000
Retained earnings		89,400			90,000
Total stockholders’ equity		124,400			120,000
Total liabilities and stockholders' equity	$	360,000		$	363,600

The company did not dispose of any property, plant, and equipment during the year. Its net income for the year was $5,400 and its cash dividends were $6,000. The company did not issue any bonds payable or purchase any of its own common stock during the year. Its net cash provided by (used in) operating activities and net cash provided by (used in) financing activities are:

Answer 1

Net cash provided (used) in operating activities

Net income	5400
Adjustment to reconcile net income
Depreciation expense	32000
Decrease account receivable	2800
Decrease inventory	2800
Decrease account payable	-1800
Decrease accured liabilities	-5800
Increase income tax payable	7600
Net cash flow from operating activities	43000

Cash flow from financing activities

Dividend paid	-6000
Repaid bond payable	-8000
Issue common Stock	5000
Net cash used in financing activities	-9000