Answer and Explanation:
The Preparation of Tiger’s statement of cash flows, using the indirect method is shown below:-
<u>TIGER ENTERPRISES</u>
<u>Income Statement
</u>
<u>For the Year Ended December 31, 2021</u>
<u>Particulars Amount</u>
Cash flow from operating activities
Net income $1,452
Non cash adjustment effects
Depreciation expenses $280
Changes in operating assets and liabilities
Decrease in accounts receivable $100
Increase in inventory ($60)
Increase in prepaid insurance ($50)
Decrease in accounts payable ($80)
Decrease in accrued liabilities ($120)
Increase in income tax payable $30 $100
Net cash flow from operating activities $1,552
Cash flow from investing activities
Equipment purchased ($500)
Net cash flow investing activities ($500)
Cash flow from financing activities
Issuance of notes payable $240
Issuance of common stock $140
Payment of dividends ($1,292)
Net cash flow from financing activities ($912)
Net increase in cash $140
Jan 1 Cash $240
Dec 32 Cash $380
Working note:-
Retained earning Opening balance $480
Add: Net income $1,452
Less: Retained earning closing balance $640
Paid dividend $1,292
