Question: Putter Corporation owns 70 percent of the
Putter Corporation owns 70 percent of the voting common stock of Sand Company. At December 31, 20X1, the companies reported the following: 
During 20X1, Sand sold inventory costing $70,000 to Putter for $100,000, and Putter resold 40 percent of the inventory prior to December 31, 20X1. No intercompany inventory transactions occurred prior to 20X1, nor did intercompany receivables and payables exist at December 31, 20X1. Required: Using the direct method, prepare the cash flows from the operating activities section of the consolidated statement of cash flows for 20X1 in good form.
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Putter Sand Corporation Company Sales, 20X1 $400,000 $240,000 Cost of goods sold, 20X1 235,000 105,000 Increase (decrease) in 20X1: Inventory (22,000) 16,000 Accounts receivable 9,000 (2,000) Accounts payable (31,000) 15,000
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