The Problem Requirement Does Not Indicate Whether the Indirect or Direct

question 122

Essay

The problem requirement does not indicate whether the indirect or direct method must be used to determine the net cash provided by operating activities. You can, if you choose, specify that either (or even both) methods be used. The solution contains solutions for both methods.
Dauber Corporation's comparative balance sheet and income statement for last year appear below: The company declared and paid a cash dividend of $55,000 during the year. It did not sell any long-term investments, issue any bonds payable, or repurchase any of its own common stock.
Required:
a. Construct in good form the operating activities section of the company's statement of cash flows for the year.
b. Construct in good form the investing activities section of the company's statement of cash flows for the year.
c. Construct in good form the financing activities section of the company's statement of cash flows for the year.

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Definitions:

Anticipatory Pain Response

Stimuli associated with painful events produce a fear response, which motivates escape from the painful environment.

Punishment

An unpleasant consequence given to reduce the occurrence of a particular behavior.

Stimulus Response Bond

The connection formed between a specific stimulus and a specific response through conditioning.

Matching Law

A principle in behavioral psychology stating that the proportion of responses directed toward an option matches the proportion of reinforcements obtained from that option.