Chapter 6, Problem 7P

Problems 7 and 8 are based on the following information.

Comparative consolidated balance sheet data for Iverson, Inc., and its 80 percent–owned subsidiary Oakley Co. follow:

	2018	2017
Cash	$ 7,000	$ 20,000
Accounts receivable (net)	55,000	38,000
Merchandise inventory	85,000	45,000
Buildings and equipment (net)	95,000	105,000
Trademark	85,000	100,000
Totals	$327,000	$308,000
Accounts payable	$ 75,000	$ 63,000
Notes payable, long-term	–0–	25,000
Noncontrolling interest	39,000	35,000
Common stock, $10 par	200,000	200,000
Retained earnings (deficit)	13,000	(15,000)
Totals	$327,000	$308,000

Additional Information for Fiscal Year 2018

• Iverson and Oakley’s consolidated net income was $45,000.
• Oakley paid $5,000 in dividends during the year. Iverson paid $12,000 in dividends.
• Oakley sold $11,000 worth of merchandise to Iverson during the year.
• There were no purchases or sales of long-term assets during the year.

  In the 2018 consolidated statement of cash flows for Iverson Company:

  7.    Net cash flows from operating activities were

  a.    $12,000

  b.    $20,000

  c.    $24,000

  d.    $25,000