Lang Company has not yet prepared a formal statement of cash flows for 2014. Following are comparative

Question:

Lang Company has not yet prepared a formal statement of cash flows for 2014. Following are comparative balance sheets as of December 31, 2014 and 2013, and a statement of income and retained earnings for the year ended December 31, 2014:

Lang Company Balance Sheet December 31 (thousands omitted) Assets 2014 2013 Current assets: $ 100 Cash 60 U.S. Treasury Lang Company Statement of Income and Retained Earnings For the Year Ended December 31, 2014 (thousands omitted) Sales $2


Required
1. For purposes of a statement of cash flows, are the U.S. Treasury bills cash equivalents? If not, how should they be classified? Explain your answers.
2. Prepare a statement of cash flows for 2014 using the direct method in the Operating Activities section.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question
Question Posted: