Chocolate Inc. began 2007 with cash of \($55,000.\) During the year Chocolate Inc. earned revenue of \($600,000\) and collected \($620,000\) from customers. Expenses for the year totaled \($420,000,\) of which Chocolate paid \($410,000\) in cash to suppliers and employees. Chocolate also paid \($140,000\) to purchase equipment and a cash dividend of \($50,000\) to its stockholders during 2007.

Prepare the company's statement of cash flows for the year ended December 31, 2007. Format operating activities by the direct method. Exhibit 16A-3.

Exhibit 16A-3

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ANCHOR CORPORATION Statement of Cash Flows Year Ended December 31, 2008 Cash flows from operating activities: Receipts: Collections from customers Interest received Dividends received Total cash receipts Payments: To suppliers To employees For interest For income tax (In thousands) $269 12 9 $290 $(135) (56) (15) (14) (220) 70 Total cash payments Net cash provided by operating activities Cash flows from investing activities: Acquisition of plant assets Cash receipts from sale of plant assets Net cash used for investing activities Cash flows from financing activities: Acquisition of plant assets Cash receipts from sale of plant assets Net cash used for investing activities Cash flows from financing activities: Cash receipts from issuance of common stock Cash receipts from issuance of notes payable Payment of note payable Payment of dividends Net cash provided by financing activities Net decrease in cash $(310) 50 (260) $(310) 50 (260) $ 100 90 (10) (10) 170 Cash balance, December 31, 2007 Cash balance, December 31, 2008 $ (20) 42 $ 22