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Serial Problem Business Solutions (Indirect) LO P2, P3

Santana Rey, owner of Business Solutions, decides to prepare a statement of cash flows for her business using the following financial data.

BUSINESS SOLUTIONS
Income Statement
For Three Months Ended March 31, 2020
Computer services revenue				$	24,307
Net sales					18,293
Total revenue					42,600
Cost of goods sold	$	14,252
Depreciation expenseOffice equipment		340
Depreciation expenseComputer equipment		1,160
Wages expense		3,150
Insurance expense		515
Rent expense		2,075
Computer supplies expense		1,255
Advertising expense		500
Mileage expense		300
Repairs expenseComputer		860
Total expenses					24,407
Net income				$	18,193

BUSINESS SOLUTIONS
Comparative Balance Sheets
December 31, 2019, and March 31, 2020
	Mar. 31, 2020						Dec. 31, 2019
Assets
Cash		$	72,457					$	52,972
Accounts receivable			24,367						5,068
Inventory			664						0
Computer supplies			2,015						490
Prepaid insurance			1,030						1,565
Prepaid rent			725						725
Total current assets			101,258						60,820
Office equipment			7,200						7,200
Accumulated depreciationOffice equipment			(680	)					(340	)
Computer equipment			19,000						19,000
Accumulated depreciationComputer equipment			(2,320	)					(1,160	)
Total assets		$	124,458					$	85,520
Liabilities and Equity
Accounts payable		$	0					$	1,120
Wages payable			905						540
Unearned computer service revenue			0						2,200
Total current liabilities			905						3,860
Equity
Common stock			102,000						74,000
Retained earnings			21,553						7,660
Total liabilities and equity		$	124,458					$	85,520

Required: Prepare a statement of cash flows for Business Solutions using the indirect method for the three months ended March 31, 2020. Owner Santana Rey contributed $28,000 to the business in exchange for additional stock in the first quarter of 2020 and has received $4,300 in cash dividends. (Amounts to be deducted should be indicated with a minus sign.)

	BUSINESS SOLUTIONS Statement of Cash Flows (Indirect) For Quarter Ended March 31, 2020 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operating activities $0 Cash flows from investing activities Net cash used in investing activities Cash flows from financing activities 0 $0 Cash balance at December 31, 2019 Cash balance at March 31, 2020 $0

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