(APPENDIX 11B) USING A SPREADSHEET TO PREPARE A STATEMENT OF CASH FLOWS Fleet Limousine Service Inc. began...
Question:
(APPENDIX 11B) USING A SPREADSHEET TO PREPARE A STATEMENT OF CASH FLOWS Fleet Limousine Service Inc. began operations in late March 2009. At the end of 2009, the following balance sheet was prepared for Fleet.
Fleet Limousine Service Inc.
Balance Sheets December 31, 2009 ASSETS Current assets:
Cash $ 7,200 Accounts receivable 15,900 Supplies inventory 3,100 Total current assets $ 26,200 Long-term investments 15,000 Property, plant, and equipment:
Land $ 11,000 Building 175,000 Equipment 233,400
$419,400 Accumulated depreciation (35,500)
Net property, plant, and equipment 383,900 Total assets $425,100 LIABILITIES AND EQUITY Current liabilities:
Accounts payable $ 12,700 Unearned revenue 21,800 Salaries payable 4,600 Rent payable 8,200 Total current liabilities $ 47,300 Long-term liabilities:
Long-term notes payable 95,000 Total liabilities $142,300 Equity:
Common stock $300,000 Retained earnings (17,200)
Total equity 282,800 Total liabilities and equity $425,100 Additional information:
a. During 2009, land was purchased for $11,000, a building was purchased for
$175,000, and equipment was purchased for $233,400.
b. Depreciation expense for 2009 was $35,500.
c. The long-term note was issued for $100,000, and a principal payment of $5,000 was made during 2009.
d. Common stock was issued for $300,000 cash during 2009.
e. During 2009, there was a net loss of 17,200 and no dividends were paid.
Required:
. Using a spreadsheet, prepare a statement of cash flows for 2009. Assume Fleet Limousine uses the indirect method.
. Discuss whether Fleet Limousine appears to have matched the timing of inflows and outflows of cash.
Case
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Cornerstones Of Financial Accounting Current Trends Update
ISBN: 9781111527952
1st Edition
Authors: Jay Rich , Jeff Jones, Maryanne Mowen , Don Hansen