Fundamentals of Advanced Accounting 5th Edition by Joe Ben Hoyle,Thomas Schaefer,Timothy Doupnik

Exercise 47

Alford Company and its 80 percent-owned subsidiary, Knight, have the following income statements for 2013:

Additional Information for 2013
• Intra-entity inventory transfers during the year amounted to $90,000. All intra-entity transfers were downstream from Alford to Knight.
• Unrealized inventory profits at January 1 were $6,000, but at December 31, they are $9,000.
• Annual excess amortization expense resulting from the acquisition is $11,000.
• Knight paid dividends totaling $20,000.
• The noncontrolling interest's share of the subsidiary's income is $9,800.
• During the year, consolidated inventory rose by $11,000 while accounts receivable and accounts payable declined by $8,000 and $6,000, respectively.
Using either the direct or indirect method, compute net cash flows from operating activities during the period for the business combination.