The company's beginning cash balance was $90 and its ending balance was $85.

Required:

1. Use the indirect method to determine the net cash provided by operating activities for the year.

2. Prepare a statement of cash flows for the year./nEXERCISE 15-4 Prepare a Statement of Cash FlowsLO15-1,LO15-2

The following changes took place last year in Pavolik Company's balance sheet accounts:

Asset and Contra-Asset Accounts

Cash and cash equivalents

Accounts receivable

Inventory

Prepaid expenses

Long-term investments

Property, plant, and equipment

Accumulated depreciation

D = Decrease; I = Increase

$5 D

$110 I

$70 D

$9 I

$6 D

$185 I

$60 I

Liabilities and Stockholders' Equity Accounts

Accounts payable

$35 I

Accrued liabilities

Income taxes payable

Bonds payable

Common stock

Retained earnings

Sales

Cost of goods sold

Gross margin

Selling and administrative expenses

Net operating income

Nonoperating items:

Loss on sale of land

Gain on sale of investments

Income before taxes

Income taxes

Net income

Long-term investments that cost the company $6 were sold during the year for $16 and land that cost $15 was sold for $9. In addition, the company

declared and paid $30 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place

during the year. Pavolik did not retire any bonds during the year or issue any new common stock.

The company's income statement for the year follows:

The company's beginning cash balance was $90 and its ending balance was $85.

$(6)

10

$700

400

300

184

116

$4 D

$8 I

$150 I

4

120

36

$ 84

$80 D

$54 I

Page 721