Preparing the statement of cash flows—direct method [35–45 min]
MPG, Inc., accountants have developed the following data from the company’s
accounting records for the year ended April 30, 2012:
a. Purchase of plant assets, $59,400.
b. Cash receipt from issuance of notes payable, $46,100.
c. Payments of notes payable, $44,000.
d. Cash receipt from sale of plant assets, $24,500.
e. Cash receipt of dividends, $4,800.
f. Payments to suppliers, $374,300.
g. Interest expense and payments, $12,000.
h. Payments of salaries, $88,000.
i. Income tax expense and payments, $37,000.
j. Depreciation expense, $59,900.
k. Collections from customers, $605,500.
l. Payment of cash dividends, $49,400.
m. Cash receipt from issuance of common stock, $64,900.
n. Cash balance: April 30, 2011, $40,000; April 30, 2012, $121,700.
Requirement
1. Prepare MPG’s statement of cash flows for the year ended April 30, 2012. Use the direct method for cash flows from operating activities.