Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

(Click the icon to view the additional information.) The 2018 income statement and comparative balance sheet of Granite Rock, Inc. follow: B Click the icon

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

image text in transcribed
image text in transcribed
(Click the icon to view the additional information.) The 2018 income statement and comparative balance sheet of Granite Rock, Inc. follow: B Click the icon to view the income statement.) (Click the icon to view the comparative balance sheel) Read the requirements. Requirement 1. Prepare the 2018 statement of cash flows, formatting operating activities by the indirect method. (Use a minus sign or parentheses for amounts that result in a decrease in cash. If a box is not used in the statement, leave the box errply; do not select a label or enter a zero.) Complete the statement one section at a time, beginning with the cash flows from operating activities. Granite Rock, Inc. Statement of Cash Flows Year Ended December 31, 2018 Cash Flows from Operating Activities: Net Income Adjustments to Reconcile Net Income to Net Cash Provided by (Used for) Operating Activities: Net Cash Provided by (Used for) Operating Activities Cash Flows from Investing Activities: Net Cash Provided by (Used for) Investing Activities Cash Flows from Financing Activities: Net Cash Provided by (Used for) Financing Activities Net Increase (Decrease) in Cash Cash Balance, December 31, 2017 Cash Balance, December 31, 2018 Non-cash Investing and Financing Activities: Total Non-cash Investing and Financing Activities Requirement 2. How will what you learned in this problem help you evaluate an investment? A. Learn how operating activities, investing activities, and financing activities generate cash receipts and cash payments O B. Learn how to predict future cash flows, evaluate management decisions, and predict the ability of the company to pay their debts and dividends O C. Both A and B OD. None of the above Granite Rock, Inc. Income Statement Year Ended December 31, 2018 Net Sales Revenue $ 434,000 201,200 Cost of Goods Sold Gross Profit 232,800 Operating Expenses: Salaries Expense 76,400 Depreciation ExpensePlant Assets 14,100 10,500 Other Operating Expenses 101,000 Total Operating Expenses Operating Income Other Income and (Expenses): 131,800 Interest Revenue 8,200 (21,800) Interest Expense Total Other Income and (Expenses) (13,600) Net Income Before Income Taxes 118,200 19,800 Income Tax Expense Granite Rock, Inc. Comparative Balance Sheet December 31, 2018 and 2017 2018 2017 Assets Current Assets: Cash 26,400 $ 14,900 Accounts Receivable 26,700 25,100 79,500 91,900 Merchandise Inventory Long-term Assets: Land 34,500 12,000 Plant Assets 118,210 (19,310) 109,310 (15,610) Accumulated DepreciationPlant Assets $ 266,000 $ 237,600 Total Assets Liabilities Current Liabilities: Accounts Payable 35,200 $ 30,500 Accrued Liabilities 28,000 30,900 Additionally, Granite Rock purchased land of $22,500 by financing it 100% with long-term notes payable during 2018. During the year, there were no sales of land, no retirements of stock, and no treasury stock transactions. A plant asset was disposed of for $0. The cost and accumulated depreciation of the disposed asset was $10,400. The plant acquisition was for cash. 1. Prepare the 2018 statement of cash flows, formatting operating activities by the indirect method. 2. How will what you learned in this problem help you evaluate an investment? Data Table 79,500 91,900 Merchandise Inventory Long-term Assets: Land 34,500 Plant Assets 118,210 (19,310) 12,000 109,310 (15,610) Accumulated Depreciation-Plant Assets $ Total Assets 266,000 $ 237,600 Liabilities Current Liabilities: Accounts Payable 30,500 35,200 $ 28,000 30,900 Accrued Liabilities Long-term Liabilities: 76,000 105,000 Notes Payable Total Liabilities 139,200 166,400 Stockholders' Equity Common Stock, no par 88,400 38,400 65,000 6,200 Retained Earnings Total Stockholders' Equity 126,800 71,200 Total Liabilities and Stockholders' Equity $ 266,000 $ 237,600 Print Done Income Statement Year Ended December 31, 2018 Net Sales Revenue $ 434,000 201,200 Cost of Goods Sold Gross Profit 232,800 Operating Expenses: Salaries Expense $ 76,400 Depreciation Expense-Plant Assets 14,100 10,500 Other Operating Expenses 101,000 Total Operating Expenses Operating Income Other Income and (Expenses): Interest Revenue 131,800 Interest Expense 8,200 (21,800) Total Other Income and (Expenses) Net Income Before Income Taxes (13,600) Income Tax Expense 118,200 19,800 Net Income $ 98,400

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

Step: 3

blur-text-image

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

Advanced Accounting

Authors: Joe Ben Hoyle, Timothy S. Doupnik, Thomas F. Schaefer, Oe Ben Hoyle

9th Edition

007337945X, 978-0073379456

More Books

Students also viewed these Accounting questions