CH. 14 - STATEMENT OF CASH FLOWS 4 A comparative balance sheet for Lomax Company containing data for the last two years is as follows: Lomax Company Comparative Balance Sheet This 2 points Last Year Year Assets Current assets: Cash and cash equivalents Accounts receivable Inventory Prepaid expenses eBook $ 86,000 $ 62,000 620,000 647,500 626,000 435,000 22,000 12,500 Print Total current assets 1,354,000 1,157,000 References 2,445,000 1,860,000 Property, plant, and equipment Less accumulated depreciation 633,000 573,500 Net property, plant, and equipment 1,812,000 1,286,500 111,500 175,000 Long term investments Loans to subsidiaries Total assets 135,000 77,500 3,412,508 2,696,000 Liabilities and Stockholders' Equity Current liabilities Accounts payable Accrued liabilities Income taxes payable $ 894,000 $ 585,000 34.000 55,500 152,500 130,000 Saved CH. 14 - STATEMENT OF CASH FLOWS Long-term investments 111,500 175,000 Loans to subsidiaries 135,000 77,500 4. Total assets $ 3,412,500$? 2,696,000 2 points Liabilities and Stockholders' Equity Current liabilities Accounts payable Accrued liabilities Income taxes payable $ 894,000 $ 585,000 34,000 55,500 152,500 130,000 eBook 1,080,500 Total current liabilities Bonds payable 770,500 445,000 695,000 Print Total liabilities 1,775,500 1,215,500 D References Stockholders' equity: Common stock Retained earnings 1,120,000 1,015,000 517,000 465,500 Total stockholders' equity 1,637,000 1,480,500 Total liabilities and stockholders' equity $ 3,412,500 $2,696,000 The following additional information is available about the company's activities during this year: a. The company declared and paid a cash dividend this year. b.Bonds with a principal balance of $395.000 were repaid during this year. c. Equipment was sold during this year for $77,500. The equipment had cost $160,000 and had $58,000 in accumulated depreciation on the date of sale d. Long-term investments were sold during the had met een Saved CH. 14 - STATEMENT OF CASH FLOWS 1,637,000 1,480,500 Total stockholders' equity 4 Total liabilities and stockholders' equity $ 3,412,500 2,696,000 2 points The following additional information is available about the company's activities during this year eBook Print a. The company declared and paid a cash dividend this year. b. Bonds with a principal balance of $395,000 were repaid during this year. c. Equipment was sold during this year for $77,500. The equipment had cost $160,000 and had $58,000 in accumulated depreciation on the date of sale. d. Long-term investments were sold during the year for $140,000. These investments had cost $63,500 when purchased several years ago. e. The subsidiaries did not repay any outstanding loans during the year. f. Lomax did not repurchase any of its own stock during the year. The company reported net income this year as follows: References Sales Cost of goods sold $3,300,000 2,046,000 Gross margin Selling and administrative expenses 1,254,000 1,009,500 Net operating income Nonoperating items: Gain on sale of investments Loss on sale of equipment 244,500 $ 76,500 24,500 52.000 Income before taxes Income taxes 296,500 95.000 Net income The company reported net income this year as follows: 4 Sales Cost of goods sold $3,300,000 2,046,000 1,254,000 2 points Gross margin Selling and administrative expenses 1,009,500 244,500 eBook Net operating income Nonoperating items: Gain on sale of investments Loss on sale of equipment Income before taxes Income taxes $76,500 24,500 52,000 Print 296,500 95,000 References Net income $ 201,500 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.) Lomax Company Statement of Cash Flows Operating activities Adjustments to convert net income to cash basis 4 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.) 2 points Lomax Company Statement of Cash Flows Operating activities: Adjustments to convert net income to cash basis: eBook Print References Investing activities: + Financing activities Saved CH. 14 - STATEMENT OF CASH FLOWS Adjustments to convert net income to cash basis: 4 2 points eBook Print Investing activities: References Financing activities: Beginning cash and cash equivalents Ending cash and cash equivalents 4 points eBook Investing activities: Print References Financing activities: Beginning cash and cash equivalents Ending cash and cash equivalents