The accounting records of South Central Distributors, Inc., reveal the following:

Requirement
1. Compute cash flows from operating activities by the indirect method. Use the format of the operating activities section of Exhibit. Also evaluate the operating cash flow of South Central Distributors. Give the reason for yourevaluation.

Transcribed Image Text:

S 42,000 S 6,000 25,000 Net income... Collection of dividend revenue Payment of interest.1 Sales revenue. Gain on sale of land....2 Acquisition of land Depreciation. 7,100 Decrease in current liabilities 12.000 ... Increase in current assets 29,000 7,700 35,000 Payment of income ax14,000 307,000 other than cash 26,000 Payment of dividends... ..3