Exercise 13-4

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Bracewell Company reported net income of $195,000for 2014. Bracewell also reported depreciation expense of $40,000and a gain of $5,000on disposal of plant assets. The comparative balance sheet shows an increase in accounts receivable of $15,000for the year, a $17,000increase in accounts payable, and a $4,000decrease in prepaid expenses.
Prepare the operating activities section of the statement of cash flows for 2014. Use the indirect method. (Show amounts that decrease cash flow with either a – sign e.g. -15,000 or in parenthesis e.g. (15,000).)

BRACEWELL COMPANY Partial Statement of Cash Flows For the Year Ended December 31, 2014
Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Decrease in Prepaid ExpensesIncrease in Accounts PayableIncrease in Accounts ReceivableIncrease in Prepaid ExpensesNet IncomeDecrease in Accounts ReceivableDepreciation ExpenseDecrease in Accounts PayableGain on Disposal of Plant Assets		$
Adjustments to reconcile net income to
Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Gain on Disposal of Plant AssetsIncrease in Accounts ReceivableIncrease in Accounts PayableDecrease in Accounts PayableDecrease in Accounts ReceivableIncrease in Prepaid ExpensesDecrease in Prepaid ExpensesNet IncomeDepreciation Expense	$
Decrease in Accounts ReceivableNet IncomeIncrease in Prepaid ExpensesDecrease in Prepaid ExpensesDecrease in Accounts PayableDepreciation ExpenseGain on Disposal of Plant AssetsIncrease in Accounts PayableIncrease in Accounts Receivable
Depreciation ExpenseDecrease in Accounts ReceivableIncrease in Accounts PayableNet IncomeDecrease in Prepaid ExpensesGain on Disposal of Plant AssetsDecrease in Accounts PayableIncrease in Accounts ReceivableIncrease in Prepaid Expenses
Increase in Accounts PayableNet IncomeDecrease in Accounts PayableDepreciation ExpenseIncrease in Accounts ReceivableDecrease in Accounts ReceivableIncrease in Prepaid ExpensesDecrease in Prepaid ExpensesGain on Disposal of Plant Assets
Increase in Accounts ReceivableDepreciation ExpenseDecrease in Prepaid ExpensesDecrease in Accounts ReceivableDecrease in Accounts PayableIncrease in Accounts PayableGain on Disposal of Plant AssetsIncrease in Prepaid ExpensesNet Income
Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash		$