Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Can someone help guide me with this question? Consultex, Inc., was founded in 2015 as a small financial consulting business. The company had done reasonably

Can someone help guide me with this question?

image text in transcribed
Consultex, Inc., was founded in 2015 as a small financial consulting business. The company had done reasonably well in 20152017 but started noticing its cash dwindle early in 2018. In January 2018, Consultex had paid $13,000 to purchase land and repaid $4,000 principal on an existing promissory note. In March, the company paid $1,400 cash for dividends and $1,100 to repurchase and eliminate Consultex stock that had previously been issued for $1,100. To improve its cash position, Consultex borrowed $4,400 by signing a new promissory note in May and also issued stock to a new private investor for $11,400 cash. Year-end comparative balance sheets and income statements are presented below. CONSULTEX, INC. Balance Sheet October 31 2018 2017 Assets Cash $ 8,970 $11,900 Accounts Receivable 12,300 11,400 Prepaid Rent 1,700 2,400 Land 24,000 11,000 Total Assets $47,470 $36,700 Liabilities and Stockholders' Equity Salaries and Wages Payable $ 1,700 $ 2,400 Income Taxes Payable 1,100 1,100 Notes Payable (long-term) 11,800 11,400 Common Stock 18,700 8,400 Retained Earnings 14,170 13,400 Total Liabilities and Stockholders' Equity $477470 $357700 CONSULTEX, INC. Income Statement For the Year Ended October 31 2018 2017 Sales Revenue $155,000 $153,000 Salaries and Wages Expense 97,400 96,400 Rent Expense 35,400 29,400 Utilities Expenses 19,100 19,400 Income before Income Tax Expense 3,100 12,800 Income Tax Expense 930 3,840 Net Income $ 2:170 $ 3.950 Required: 1. Prepare a properly formatted Statement of Cash Flows for Consultex, Inc., for the year ended October 31, 2018 (using the indirect method). (Amounts to be deducted should be indicated with a minus sign.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Statement Analysis And Security Valuation

Authors: Stephen H Penman

4th Edition

0073379662, 9780073379661

Students also viewed these Accounting questions

Question

What is meant by formal organisation ?

Answered: 1 week ago

Question

What is meant by staff authority ?

Answered: 1 week ago

Question

Discuss the various types of policies ?

Answered: 1 week ago

Question

Briefly explain the various types of leadership ?

Answered: 1 week ago