Question

Condensed financial data of Monty Company for 2020 and 2019 are presented below.

Answer 1

Answer:

                       Monty Company

                 Statement of Cash Flows

                      December 31, 2020

Cash flows from operating activities

Net income                                                           $790

Adjustments to reconcile net income                  $40

+ depreciation expense $40

+ decrease in inventory $260

+ increase in accounts payable $300

- gain from sale of investments ($80)

- increase in accounts receivable ($430)

- decrease in accrued liabilities ($50)                        

Net cash flow from operating activities               $830

Cash flows from investing activities

Sale of long term investments                               $140

Gain from sale of investments                                 $80

Purchases of P, P & E                                            ($190)

Net cash flow from investing activities                    $30

Cash flow from financing activities

Issuance of Common Stocks                                  $210

- Payments of long term debt                               ($160)

- Dividends paid                                                    ($260)

Net cash from financing activities                        ($210)

Net increase in cash                                                $650

+ Beginning cash balance                                     $1,160

Ending cash balance                                             $1,810