(CMA Adapted, Jun 94 #4) Spring Corporation, a Public Company

question 73

Essay

(CMA adapted, Jun 94 #4) Spring Corporation, a public company, has prepared all of its year-end financial statements with the exception of the statement of cash flows.Presented below is condensed financial information for the years ended May 31, Year 3 and Year 4, as well as supplemental data on certain transactions that occurred during the year ended May 31, Year 4.

Required:
Using the indirect method, prepare the Statement of Cash Flows for Spring Corporation for the year ended May 31, Year 4.The statement should comply with the requirements of Statements of Financial Accounting Standards No.95, 'Statement of Cash Flows,' and be supported by appropriate calculations.

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Definitions:

Savings Account

A deposit account held at a bank that provides interest on the funds deposited.

Lump Sum

An individual disbursement occurring at a certain point, in contrast to periodic payments carried out sequentially.

Proceeds

The amount of money received from a sale or transaction.

Interest

The cost of borrowing money, typically expressed as a percentage of the principal, paid by the borrower for the use of lender’s funds.