2 For the just completed year, Hanna Company had net income of $74,500 Balances in the companys current asset and current liability accounts at the beginning and end of the year were as follows December 31 End of Year Beginning of Year Current assets Cash $ 60,000 $ 82,000 Accounts receivable $ 152,000 $ 188,000 Inventory $ 439,000 $ 346,000 Prepaid expenses $ 12,000 $ 14,500 Current liabilities Accounts payable $ 362,000 $ 392,000 Accrued liabilities $ 7,500 $ 12,500 Income taxes payable $ 35,000 $ 27,000 The Accumulated Depreciation account had total credits of $42,000 during the year Hanna Company did not record any gains or losses during the year Required Use the indirect method to determine the net cash provided by (or used in) operating activities for the year (List any deduction in cash and cash outflows as negative amounts ) 3 Apex Company prepared the statement of cash flows for the current year that is shown below Apex Company Statement of Cash FlowsIndirect Method Operating activities Net income $ 41,200 Adjustments to convert net income to cash basis Depreciation $ 20,400 Increase in accounts receivable (62,000) Increase in inventory (25,200) Decrease in prepaid expenses 9,900 Increase in accounts payable 54,000 Decrease in accrued liabilities (11,000) Increase in income taxes payable 3,300 (10,600) Net cash provided by operating activities 30,600 Investing activities Proceeds from the sale of equipment 15,400 Loan to Thomas Company (40,000) Additions to plant and equipment (121,100) Net cash used for investing activities (145,700) Financing activities Increase in bonds payable 89,100 Increase in common stock 39,800 Cash dividends (28,900) Net cash provided by financing activities 100,000 Net decrease in cash (15,100) Beginning cash balance 27,900 Ending cash balance $ 12,800 Required Compute Apex Companys free cash flow for the current year (Negative amount should be indicated by a minus sign ) 4 Comparative financial statement data for Carmono Company follow This Year Last Year Assets Cash $ 16 00 $ 31 00 Accounts receivable 84 00 77 00 Inventory 135 00 123 40 Total current assets 235 00 231 40 Property, plant, and equipment 282 00 228 00 Less accumulated depreciation 59 20 44 40 Net property, plant, and equipment 222 80 183 60 Total assets $ 457 80 $ 415 00 Liabilities and Stockholders Equity Accounts payable $ 81 00 $ 63 00 Common stock 186 00 142 00 Retained earnings 190 80 210 00 Total liabilities and stockholders equity $ 457 80 $ 415 00 For this year, the company reported net income as follows Sales $ 1,700 00 Cost of goods sold 1,020 00 Gross margin 680 00 Selling and administrative expenses 660 00 Net income $ 20 00 This year Carmono declared and paid a cash dividend There were no sales of property, plant, and equipment during this year The company did not repurchase any of its own stock this year Required 1 Using the indirect method, prepare a statement of cash flows for this year (List any deduction in cash and cash outflows as negative amounts Round your intermediate calculations and final answers to 2 decimal places ) 4b Compute Carmonos free cash flow for this year (Negative amount should be indicated by a minus sign Round your intermediate calculations and final answer to 2 decimal places ) 5 The following changes took place last year in Pavolik Companys balance sheet accounts Asset and Contra Asset Accounts Liabilities and Equity Accounts Cash $ 7 D Accounts payable $ 23 I Accounts receivable $ 11 I Accrued liabilities $ 11 D Inventory $ 32 D Income taxes payable $ 16 I Prepaid expenses $ 6 I Bonds payable $ 100 I Long term investments $ 8 D Common stock $ 44 D Property, plant, and equipment $ 200 I Retained earnings $ 43 I Accumulated depreciation $ 43 I D Decrease I Increase Long term investments that had cost the company $8 were sold during the year for $20, and land that had cost $19 was sold for $11 In addition, the company declared and paid $5 in cash dividends during the year Besides the sale of land, no other sales or retirements of plant and equipment took place during the year Pavolik did not retire any bonds during the year or issue any new common stock The companys income statement for the year follows Sales $ 630 Cost of goods sold 264 Gross margin 366 Selling and administrative expenses 290 Net operating income 76 Nonoperating items Loss on sale of land $ (8) Gain on sale of investment 12 4 Income before taxes 80 Income taxes 32 Net income $ 48 The companys beginning cash balance was $102 and its ending balance was $95 Required 1 Using the indirect method, determine the net cash provided by used in operating activities for the year (List any deduction in cash and cash outflows as negative amounts ) 2 Prepare a statement of cash flows for the year (List any deduction in cash and cash outflows as negative amounts )

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2. For the just completed year, Hanna Company had net income of $74,500. Balances in the companys current asset and current liability accounts at the

2. For the just completed year, Hanna Company had net income of $74,500. Balances in the companys current asset and current liability accounts at the beginning and end of the year were as follows:

	December 31
	End of Year		Beginning of Year
Current assets:
Cash	$	60,000	$	82,000
Accounts receivable	$	152,000	$	188,000
Inventory	$	439,000	$	346,000
Prepaid expenses	$	12,000	$	14,500
Current liabilities:
Accounts payable	$	362,000	$	392,000
Accrued liabilities	$	7,500	$	12,500
Income taxes payable	$	35,000	$	27,000

The Accumulated Depreciation account had total credits of $42,000 during the year. Hanna Company did not record any gains or losses during the year.

Required:

Use the indirect method to determine the net cash provided by (or used in) operating activities for the year.(List any deduction in cash and cash outflows as negative amounts.)

3. Apex Company prepared the statement of cash flows for the current year that is shown below:

Apex Company Statement of Cash FlowsIndirect Method
Operating activities:
Net income			$	41,200
Adjustments to convert net income to cash basis:
Depreciation	$	20,400
Increase in accounts receivable		(62,000)
Increase in inventory		(25,200)
Decrease in prepaid expenses		9,900
Increase in accounts payable		54,000
Decrease in accrued liabilities		(11,000)
Increase in income taxes payable		3,300		(10,600)

Net cash provided by operating activities				30,600
Investing activities:
Proceeds from the sale of equipment		15,400
Loan to Thomas Company		(40,000)
Additions to plant and equipment		(121,100)

Net cash used for investing activities				(145,700)
Financing activities:
Increase in bonds payable		89,100
Increase in common stock		39,800
Cash dividends		(28,900)

Net cash provided by financing activities				100,000

Net decrease in cash				(15,100)
Beginning cash balance				27,900

Ending cash balance			$	12,800

Required:

Compute Apex Companys free cash flow for the current year. (Negative amount should be indicated by a minus sign.)

4. Comparative financial statement data for Carmono Company follow:

	This Year		Last Year
Assets
Cash	$	16.00	$	31.00
Accounts receivable		84.00		77.00
Inventory		135.00		123.40

Total current assets		235.00		231.40

Property, plant, and equipment		282.00		228.00
Less accumulated depreciation		59.20		44.40

Net property, plant, and equipment		222.80		183.60

Total assets	$	457.80	$	415.00

Liabilities and Stockholders Equity
Accounts payable	$	81.00	$	63.00
Common stock		186.00		142.00
Retained earnings		190.80		210.00

Total liabilities and stockholders equity	$	457.80	$	415.00

For this year, the company reported net income as follows:


Sales	$	1,700.00
Cost of goods sold		1,020.00

Gross margin		680.00
Selling and administrative expenses		660.00

Net income	$	20.00

This year Carmono declared and paid a cash dividend. There were no sales of property, plant, and equipment during this year. The company did not repurchase any of its own stock this year.

Required:
1.	Using the indirect method, prepare a statement of cash flows for this year. (List any deduction in cash and cash outflows as negative amounts. Round your intermediate calculations and final answers to 2 decimal places.)

.	4b. Compute Carmonos free cash flow for this year. (Negative amount should be indicated by a minus sign. Round your intermediate calculations and final answer to 2 decimal places.)

5. The following changes took place last year in Pavolik Companys balance sheet accounts:

Asset and Contra-Asset Accounts				Liabilities and Equity Accounts
Cash	$	7	D	Accounts payable	$	23	I
Accounts receivable	$	11	I	Accrued liabilities	$	11	D
Inventory	$	32	D	Income taxes payable	$	16	I
Prepaid expenses	$	6	I	Bonds payable	$	100	I
Long-term investments	$	8	D	Common stock	$	44	D
Property, plant, and equipment	$	200	I	Retained earnings	$	43	I
Accumulated depreciation	$	43	I

D = Decrease; I = Increase.

Long-term investments that had cost the company $8 were sold during the year for $20, and land that had cost $19 was sold for $11. In addition, the company declared and paid $5 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place during the year. Pavolik did not retire any bonds during the year or issue any new common stock.

The companys income statement for the year follows:


Sales			$	630
Cost of goods sold				264

Gross margin				366
Selling and administrative expenses				290

Net operating income				76
Nonoperating items:
Loss on sale of land	$	(8)
Gain on sale of investment		12		4

Income before taxes				80
Income taxes				32

Net income			$	48

The companys beginning cash balance was $102 and its ending balance was $95.

Required:

1.	Using the indirect method, determine the net cash provided by / used in operating activities for the year.(List any deduction in cash and cash outflows as negative amounts.)