Textbook Problem

Statement of Cash Flows The following is a list of items for Witts Company’s 2019 statement of cash flows:

1. a. receipt from sale of equipment, $2,700
2. b. increase in inventory, $3,900
3. c. net income, $13,500
4. d. payment for purchase of building, $29,000
5. e. depreciation expense, $8,700
6. f. receipt from issuance of bonds, $8,000
7. g. increase in prepaid expenses, $800
8. h. loss on sale of equipment, $2,200
9. i. payment of dividends, $5,200
10. j. decrease in accounts receivable, $1,700
11. k. issuance of common stock for land, $6,900
12. l. decrease in accounts payable, $1,500
13. m. beginning cash balance, S 10,200

Required:

1. 1. Prepare the statement of cash flows.
2. 2. Next Level Under IFRS, what alternative treatment of the payment of dividends is allowed? How would this affect the statement of cash flows?