Using the information provided inM12-13 ,complete a Statement of Cash Flow for Tech Gear Corporation (you may use year-end December 2021 for the date).

3) Evaluate the cash flows included in your completed statement. Refer topp.571-573as your guide for the evaluation. You may also be guided by the following questions:

• Does the company generate sufficient cash from the use of current assets and liabilities (or operating activities)?
• What are its major sources (inflows) and uses (outflows) of cash during the period?
• Did the company's cash balance increase or decrease during the period? How much?
• Based on the cash flows from three activities, is the company healthy overall? Why do you say so?

 

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M12-13 Calculating Cash Flows Tech Gear Corp. started the year with $100,000 cash and reported net cash provided by operat- ing activities of $200,000, cash paid for dividends of $40,000, cash received from stock issuance of $30,000, cash paid for equipment purchases of $150,000, cash paid for intangible assets of $100,000, and cash paid on bank loan of $35,000. Calculate the following: 1. Net cash provided by (used in) investing activities. 2. Net cash provided by (used in) financing activities. 3. Ending cash. 4. Free cash flow. M12-14 Matching Items Reported to Cash Flow Statement Categories (Direct Method) Prestige Manufacturing Corporation reports the following items in its statement of cash flows presented using the direct method. Indicate whether each item is disclosed in the operating activities (O), investing activities (I), or financing activities (F) section of the statement under GAAP or use (NA) if the item does not appear on the statement. 1. Payment for equipment purchase. 2. Repayments of bank loan. 3. Dividends paid. 4. Proceeds from issuance of stock. M12-13 Calculating Cash Flows Tech Gear Corp. started the year with $100,000 cash and reported net cash provided by operat- ing activities of $200,000, cash paid for dividends of $40,000, cash received from stock issuance of $30,000, cash paid for equipment purchases of $150,000, cash paid for intangible assets of $100,000, and cash paid on bank loan of $35,000. Calculate the following: 1. Net cash provided by (used in) investing activities. 2. Net cash provided by (used in) financing activities. 3. Ending cash. 4. Free cash flow. M12-14 Matching Items Reported to Cash Flow Statement Categories (Direct Method) Prestige Manufacturing Corporation reports the following items in its statement of cash flows presented using the direct method. Indicate whether each item is disclosed in the operating activities (O), investing activities (I), or financing activities (F) section of the statement under GAAP or use (NA) if the item does not appear on the statement. 1. Payment for equipment purchase. 2. Repayments of bank loan. 3. Dividends paid. 4. Proceeds from issuance of stock.