The statement of financial position of House Construction Co. for June 30, 2015 and 2014, as presented in Problem 16-1B, is as follows:

The statement of income for the year ended June 30, 2015, is as follows:

The following additional information was taken from the records:
a. Equipment and land were acquired for cash.
b. There were no disposals of equipment during the year.
c. The investments were sold for $54,000 cash.
d. The common shares were issued for cash.
e. There was a $60,000 debit to Retained Earnings for cash dividends declared.
Instructions
Prepare a statement of cash flows using the direct method of presenting cash flows from operating activities.

Transcribed Image Text:

June 30, 2015 June 30, 2014 Assets $ 41,600 121,900 175,600 Cash... Accounts receivable (net) Inventories.. $ 28,200 110,700 170,500 Investments.. 60,000 Equipment.. Accumulated depreciation. . 210,600 (49,600) 258.000 (58,300) Land.. 174,000 $712,800 $530,400 Liabilities and Shareholders' Equity $114,200 Accounts payable (merchandise creditors).... Accrued expenses payable (operating expenses).. Dividends payable .. Common shares Retained earnings $121.000 18.000 15,800 15.000 12,000 331,200 180,000 208,400 227.600 $712.800 $530,400 Sales $1,134,900 Cost of goods sold Gross profit ... Operating expenses: Depreciation expense Other operating expenses. 698.400 436.,500 $ 8,700 289,800 Total operating expenses Operating income Other expenses: Loss on sale of investments.. 298,500 138,000 (6,000) Income before income taxes 132,000 Income taxes expense 52.800 Net income . 79.200