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The text states, "Over sufficiently long time periods, netincome equals cash inflows minus cash outflows, other than cashflows with owners." Demonstrate the accuracy of this statement inthe following scenario: Two friends contributed $50,000 each toform a new business. The owners used the amounts contributed topurchase a machine for $100,000 cash. They estimated that theuseful life of the machine was five years and the salvage value was$20,000. They rented out the machine to a customer for an annualrental of $25,000 a year for five years. Annual cash operatingcosts for insurance, taxes, and other items totaled $6,000annually. At the end of the fifth year, the owners sold theequipment for $22,000, instead of the $20,000 salvage valueinitially estimated. (Hint: Compute the total net income and thetotal cash flows other than cash flows with owners for thefive-year period as a whole.)CASHEQUIPMENTCOMMON STOCKNET INCOMEcash contributed by ownerspurchase of machine for cashrecognition of rent revenuerecognition of operating expensesrecognition of depreciationsale of machinetotals $ $ $ $