Comprehensive Problem 2 - St of Cash Flows and Ratios Algo

C. Ruiz Inc.				C. Ruiz Inc.
Income Statement				Comparative Balance Sheets
For years ended December 31, 2017 and 2018				December 31, 2018 and 2017
					2018	2017	Change
	2018	2017		Current assets:
Sales (all on credit)	$740,000	$703,000		Cash	$122,760	$70,300	$52,460
Cost of goods sold	(379,000)	(311,000)		Accounts receivable (net)	34,000	28,000	6,000
Gross margin	361,000	392,000		Inventory	55,000	52,000	3,000
				Prepaid expenses	2,000	4,400	-2,400
Depreciation expense	36,000	51,000		Other current assets	2,820	4,300	-1,480
Other operating expenses	159,000	132,000		Total current assets	216,580	159,000	57,580
Total operating expenses	195,000	183,000
Operating income	166,000	209,000		Long-term Investments	75,000	52,000	23,000
Other income (expenses)				Plant assets	302,000	253,000	49,000
Interest expense	(5,400)	(4,000)		Less: accumulated depreciation	(76,800)	(51,000)	25,800
Gain on sale of investments	7,200	5,000		Total plant assets	225,200	202,000	23,200
Loss on sale of plant assets	(4,400)	(5,300)		Total assets	516,780	413,000	103,780
Total other income (expenses)	(17,000)	(4,300)
				Current liabilities:
Income before income taxes	163,400	204,700		Accounts payable	$35,300	$36,000	$-700
Income taxes expense	(49,020)	(61,410)		Accrued liabilities	6,000	5,000	1,000
Net income	$114,380	$143,290		Income taxes payable	4,100	15,000	-10,900
				Total current liabilities	45,400	56,000	-10,600
C. Ruiz Inc.				Long term liabilities:
Statement of Retained Earnings				Notes Payable	269,000	200,000	69,000
For the year ended December 31, 2018				Total liabilities	314,400	256,000	58,400
	2018	2017
Ret. earnings, Jan. 1	$32,000	$0		Stockholders' equity
Add: net income	114,380	143,290		Common stock, $5 par value	100,000	100,000	0
Deduct: Dividends	(69,000)	(111,290)		Additional paid-in capital	25,000	25,000	0
Increase in retained earnings	45,380	32,000		Retained earnings	77,380	32,000	45,380
Ret. earnings, Dec. 31	$77,380	$32,000		Total stockholders equity	202,380	157,000	45,380
				Total liabilities and stockholders equity	$516,780	$413,000	$103,780
Other information:
Shares of common stock outstanding	20,000	20,000
Earnings per share	$5.72	$7.16
Dividends per share	$3.45	$5.56
Market price per share, common stock	$17	$13

Requirement Prepare the cash flows from operations section of C. Ruiz Inc.'s 2018 statement of cash flows using the indirect method. Enter items to be subtracted as negative values.

Cash Flows from Oper Horiz Analysis Horiz Analysis Vertic Analysis Vertic Analysis Inc St Bal St Inc St Bal Sheet Ratios Requirement Prepare the cash flows from operations section of C. Ruiz Inc.'s 2018 statement of cash flows using the indirect method. Enter items to be subtracted as negative values. d C. Ruiz Inc. Cash Flows from Operating ActivitiesIndirect Method For Year Ended December 31, 2018 Cash flows from operating activities: Net income 114,380 Adjustments to reconcile net income to net cash provided by operations: Less: Gain on sale of investments (7,200) Add: Loss on sale of plant assets 4,400 Add: Interest expense 5,400 Less: Depreciation expense 36,000 Add: Income taxes expense X 49,020 X Add: Accounts payable increase X 6,000 Less: Inventory increase (3,000) Less: Other operating expenses X 159,000 X Less: Prepaid expenses decrease 2,400 x X X 252,020 Net cash provided by operating activities $ 366,400