Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Consultex, Incorporated, was founded in 2018 as a small financial consulting business. The company had done reasonably well from 2018 through 2020 but started noticing

image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Consultex, Incorporated, was founded in 2018 as a small financial consulting business. The company had done reasonably well from 2018 through 2020 but started noticing its cash dwindle early in 2021. In January 2021. Consultex had paid $19,500 to purchase land and repaid $2,000 principal on an existing promissory note. In March, the company paid $2,700 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 $5,700 by signing a new promissory note in May and also issued stock to a new private investor for $12,700 cash. Year-end comparative balance sheets and income statements are presented below. 1. Prepare a properly formatted Statement of Cash Flows for Consultex, Incorporated, for the year ended October 31, 2021 (using the indirect method). (Amounts to be deducted should be indicated with a minus sign.) CONSULTEX, INCORPORATED Statement of Cash Flows For the Year Ended October 31, 2021 Cash Flows from Operating Activities: Net Income $3,990 Changes in Current Assets and Current Liabilities \begin{tabular}{|l|} \hline Accounts Receivable \\ \hline Prepaid Rent \\ \hline Salaries and Wages Payable \\ \hline \end{tabular} Cash Provided by Operating Activities 6,690 Cash Flows from Investing Activities: Purchased Land Cash Used in Investing Activities Cash Flows from Financing Activities: Issued New Company Common Stock Issued New Promissory Note Paid Cash Dividends Repaid Promissory Note Principal \begin{tabular}{|l|l|l|l|} \hline Accounts Receivable & & 2,700 & \\ \hline Prepaid Rent & & & \\ \hline Salaries and Wages Payable & & & \\ \hline & & & \\ \hline Cash Provided by Operating Activities & & \\ \hline Cash Flows from Investing Activities: & & \\ \hline Purchased Land & & & \\ \hline & & & \\ \hline Cash Used in Investing Activities & & \\ \hline Cash Flows from Financing Activities: & & \\ \hline & & & \\ \hline Issued New Company Common Stock & & & \\ \hline Issued New Promissory Note & & \\ \hline Paid Cash Dividends & & \\ \hline Repaid Promissory Note Principal & & \\ \hline Repurchased Company Common Stock & & \\ \hline & & \\ \hline Net Decrease in Cash & & \\ \hline Beginning Cash Position, October 31,2020 & & \\ \hline Ending Cash Position, October 31,2021 & & \\ \hline \end{tabular}

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

Financial Accounting

Authors: Karen Bird, Gene Imhoff

3rd Edition

0984200541, 9780984200542

More Books

Students also viewed these Accounting questions

Question

What are the strengths and weaknesses of arguments by analogy?

Answered: 1 week ago