Wisconsin Corporation was organized at the beginning of the year with the investment of $400,000 in cash by its stockholders. The company immediately purchased a manufacturing facility for $300,000, paying $150,000 in cash and signing a five-year promissory note for the balance. Wisconsin signed another five-year note at the bank for $50,000 during the year and received cash in the same amount. During its first year, Wisconsin collected $310,000 from its customers. It paid $185,000 for inventory, $30,100 in salaries and wages, and another $40,000 in taxes. Wisconsin paid $4,000 in cash dividends.

Required

1. Prepare a statement of cash flows for the year.

2. What does this statement tell you that an income statement does not?

Answer rating: 100% (QA)

Statement of cash flows Direct method Statement of Cash flow A Statement that shows the inflows and outflows of cash or cash equivalents is known as a ... View the full answer