Answer and Explanation:
The preparation of the cash flow statement is presented below:
Stamos corporation
Statement of cash flow Indirect method
For year ended December 31, 2020
Cash flow from operations activities:
Net Income $262,600
Adjustments to reconcile Net Income:
Depreciation $147,000
Less: Increase in account receivables -$8,600
Less: Increase in inventory -$11,000
Less: Decrease in accounts payable -$3,400
Add: Increase in income tax payable $4,600
Net cash flow from operating activities $391,200
Cash flow from investing activities:
Cash received for sale of land $35,000
Less: Cash used to purchase of building $297,000
Net cash flow from investing activities -$262,000
Cash flow from financing activities:
Less: Cash used to purchase of treasury stock -$26000
Cash received from issuing bonds $189,000
Less: Cash dividends paid -$11,000
Net Cash flow from financing activities $152,000
Net increase in cash $281,200
Cash balance at starting of the year $42,000
Cash balance at the end of year $323,200
The cash inflow shows in the positive sign and the cash outflow shows in negative sign
