The statement of income of Morin Cycle Co. for the year ended December 31, 2015, is as follows:

/in /by

The statement of income of Morin Cycle Co. for the year ended December 31, 2015, is as follows:

Instructions

  1. Using the information from Problem 16-3A and the additional information provided, prepare a statement of cash flows using the direct method of presenting cash flows from operating activities.

  2. How does Morin’s cash flow compare to its net income? Summarize the changes that caused the difference.