The income statement and additional data of Amalgamated Services, Inc., follow: Additional data: a. Acquisition of fixed

Question:

The income statement and additional data of Amalgamated Services, Inc., follow:

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Additional data:

a. Acquisition of fixed assets totaled $115,000. Of this amount, $85,000 was paid in cash; a $30,000 note payable was signed for the remainder.

b. Proceeds from the sale of land totaled $21,000. No gain or loss was recognized on the sale.

c. Proceeds from issuance of common stock total $34,000.

d. Payment of a long-term note payable was $17,000.

e. Payment of dividends was $11,000.

f. Data from the comparative balance sheet follow:

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Requirements

1. Prepare Amalgamated Services? statement of cash flows for the year ended June 30, 2018, using the indirect method.

2. Calculate Amalgamated Services free cash flow for the year ended June 30, 2018.

3. Evaluate Amalgamated Services? cash flows for the year. In your evaluation, mention all three categories of cash flows as well as free cash flow and give the reason for your evaluation.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...
Free Cash Flow
Free cash flow (FCF) represents the cash a company generates after accounting for cash outflows to support operations and maintain its capital assets. Unlike earnings or net income, free cash flow is a measure of profitability that excludes the...
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Related Book For  book-img-for-question

Financial Accounting

ISBN: 978-0134727790

5th edition

Authors: Robert Kemp, Jeffrey Waybright

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