The accounting staff of Wyoming Outfitters has assembled the following information for the year ended December 31, 2012:
Cash and cash equivalents, January 1 $35,800
Cash and cash equivalents, December 31 $74,800
Cash paid to acquire plant assets $21,000 Investng
Proceeds from short-term borrowings $10,000 Financing
Loans made to borrowers $5,000Financing
Collections on loans (excluding interest) $4,000
Interest and dividend received $27,000
Cash received from customers $795,000
Proceeds from sale of plant asset $9,000
Dividends paid $55,000
Cash paid to suppliers and employees $635,000
Interest paid $19,000
Income taxes paid $71,000
(a) Using the above information, prepare a statement of cash flows. Include proper heading for the financial statement, and classify the given information into the categories of operating, investing and financial activities.
(b) Determine the net cash flows from operating activities under direct method.