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Cash balance at prior year-end Increase in inventory Depreciation expense Cash received from issuing stock Cash paid for dividends $ 40,000 Gain on sale
Cash balance at prior year-end Increase in inventory Depreciation expense Cash received from issuing stock Cash paid for dividends $ 40,000 Gain on sale of machinery 5,000 Cash received from sale of machinery 4,000 Increase in accounts payable 8,000 Net income 1,000 Decrease in accounts recevable $ 2,000 9,500 1,500 23,000 3,000 VPI COMPANY Statement of Cash Flows (Indirect Method) Cash flows from operating activities For Current Year Ended December 31 Net income 23,000 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense 4,000 Gain on sale of machinery (2,000) Changes in current operating assets and liabilities Decrease in accounts receivable Increase in inventory Decrease in accounts payable Gain on sale of machinery 3,000 (5,000) 1,500 9,500 34,000 Cash flows from investing activities Cash received from issuing stock Cash paid for dividends Cash flows from financing activities Cash Cash paid for dividends 8,000 (1,000) 7,000 8,000 (1.000) Gain on sale of machinery Changes in current operating assets and liabilities (2,000) Decrease in accounts receivable Increase in inventory Decrease in accounts payable Gain on sale of machinery 3,000 (5,000) 1,500 + 9,500 $ 34,000 Cash flows from investing activities Cash received from issuing stock 8,000 Cash paid for dividends (1,000) 7,000 Cash flows from financing activities Cash 8,000 Cash paid for dividends (1,000) Net increase in cash Cash balance at prior year-end Cash balance at current year-end 7,000 $ 48,000 40,000 $ 88,000
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