Use the data in E14- 8 to answer the following questions.
In exercise Recording and Reporting an Equity Method Security Felicia Company acquired some of the 60,000 outstanding common shares of Nueces Corporation during 2014, as a non- current investment. The fiscal year for both companies ends December 31. The following transactions occurred during 2014: Jan. 10 Purchased 21,000 of Nueces common shares at $ 12 per share.
Required:
1. How would the investing section of the statement of cash flows for 2014 be affected by the preceding transactions?
2. How would the equity in the earnings of Nueces Corporation and the dividends received from Nueces Corporation affect the operating section of the statement of cash flows for 2014, using the indirect method? Explain the reasons for the effects.