The Ladies Store presented the following statement of cash flows for the year ended December 31, 2009:
THE LADIES STORE
Statement of Cash Flows
For Year Ended December 31, 2009
Cash received:
From sales to customers .........................$150,000
From sales of bonds ...........................100,000
From issuance of notes payable .......................40,000
From interest on bonds .............................5,000
Total cash received ............................295,000
Cash payments:
For merchandise purchases .........................110,000
For purchase of truck ...........................20,000
For purchase of investment ...........................80,000
For purchase of equipment ...........................45,000
For interest ................................2,000
For income taxes ..............................15,000
Total cash payments ............................272,000
Net increase in cash ............................$ 23,000
Depreciation expense was $15,000.
Required
a. Prepare a statement of cash flows in proper form.
b. Comment on the major flows of cash.