The income statement and additional data of Value World, Inc., follow:

Additional data:
a. Collections from customers are $25,000 less than sales.
b. Payments to suppliers are $1,600 more than the sum of cost of goods sold plus advertising expense.
c. Payments to employees are $2,400 more than salary expense.
d. Dividend revenue, interest expense, and income tax expense equal their cash amounts.
e. Acquisition of plant assets is $209,000. Of this amount, $109,000 is paid in cash and $100,000 by signing a long-term note payable.
f. Proceeds from sale of land total $27,000.
g. Proceeds from issuance of common stock total $93,000.
h. Payment of long-term note payable is $17,000.
i. Payment of dividends is $9,000.
j. Cash balance, September 30, 2011, was $10,000.

Requirements
1. Prepare Value World, Inc.€™s statement of cash flows and accompanying schedule of non-cash investing and financing activities. Report operating activities by the direct method.
2. Evaluate Value World€™s cash flows for the year. In your evaluation, mention all three categories of cash flows and give the reason for yourevaluation.

Value World, Inc. Income Statement Year Ended September 30, 2012 Revenues: $255,000 Sales revenue Dividend revenue 9.500 $264.500 Expenses: Cost of goods sold Salary expense 101,000 43,000 27,000 10,500 2,200 11,500 n expense Advertising expense Interest expense Income tax expense 195,200 S 69,300 Net income