The balance sheet data of Wyeth Company at the end of 2010 and 2009 follow.

1.

Land was acquired for $30,000 in exchange for common stock, par $30,000,
during the year

2.

All equipment purchased was for cash.

3.

Equipment costing $13,000 was sold for $3,000; book value of the equipment
was $6,000.

Cash dividends of $9,000 were declared and paid during the year.

Instructions
Compute net cash provided (used) by:
a. Operating activities.
b. Investing activities.
c. Financing activities.

Solution
Wyeth Company
Cash Flow Statement
Net Income
Plus: Depreciation
Loss on sale of equipment

15,000
17,000
3,000

35,000

10,000
20,000
10,000
13,000
3,000 -

10,000

28,000 -

28,000

23,000
30,000
9,000 -

2,000

5,000

Operating
Increase in Accounts Receivable
Increase in Merchandise Inventory
Decrease in Prepaid Expenses
Increase in Accounts Payable
Decrease in Accrued Expenses
Investing
Purchase of new equipment
Financing
Payment of notes payable
Issuance of Notes Payable
Dividends Paid
Subtotal
Plus: Cash December 31, 2009

Cash December 31, 2010

35,000

30,000