The Diversified Portfolio Corporation provides investment advice to customers. A condensed income statement for the year ended December 31, 2021, appears below: Service revenue $ 1,180,000 Operating expenses 840,000 Income before income taxes 340,000 Income tax expense 85,000 Net income $ 255,000 The following balance sheet information also is available: 12/31/2021 12/31/2020 Cash $ 452,000 $ 84,000 Accounts receivable 148,000 114,000 Accrued liabilities (for operating expenses) 98,000 74,000 Income taxes payable 24,000 43,000 In addition, the following transactions took place during the year: 1.Common stock was issued for $128,000 in cash. 2.Long-term investments were sold for $64,000 in cash/ The original cost of the investments also was $64,000. 3.$94,000 in cash dividends was paid to shareholders. 4.The company has no outstanding debt, other than those payables listed above. 5.Operating expenses include $44,000 in depreciation expense. Required: Prepare a statement of cash flows for 2021 for the Diversified Portfolio Corporation. Use the direct method for reporting operating activities.
The Diversified Portfolio Corporation provides investment advice to customers. A condensed income statement for the year ended December 31, 2021, appears below:
Service revenue $ 1,180,000
Operating expenses 840,000
Income before income taxes 340,000
Income tax expense 85,000
Net income $ 255,000
The following
12/31/2021 12/31/2020
Cash $ 452,000 $ 84,000
Accrued liabilities (for operating expenses) 98,000 74,000
Income taxes payable 24,000 43,000
In addition, the following transactions took place during the year:
1.Common stock was issued for $128,000 in cash.
2.Long-term investments were sold for $64,000 in cash/ The original cost of the investments also was $64,000.
3.$94,000 in cash dividends was paid to shareholders.
4.The company has no outstanding debt, other than those payables listed above.
5.Operating expenses include $44,000 in
Required:
Prepare a statement of
Diversified Portfolio Corporation
Statement of Cash Flows
For the Year Ended December 31, 2021
Cash flows from operating activities:
_____________________________________ ______________________
_____________________________________ ______________________
_____________________________________ _______________________
_____________________________________ _______________________
_____________________________________ _______________________
Net cash flows from operating activities $ 0
Cash flows from investing activities
_____________________________________ ______________________
_____________________________________ ______________________
Net cash flows from investing activities 0
Cash flows from financing activities
______________________________________ ______________________
______________________________________ ______________________
______________________________________ _______________________
Net cash flows from financing activities 0
Increase in cash 0
Cash and cash equivalents, January 1 __________
Cash and cash equivalents, December 31 $ 0
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
