Cookie Creations 17 (Part Level Submission) Natalie has prepared the balance sheet and income statement of Cookie & Coffee Creations Inc. for the first year of operations, but does not understand how to prepare the statement of cash flows. The income statement and balance sheet appear below. Recall that the company started operations on November 1, 2017, so all of the opening balances are zero. The income statement and balance sheet appear below. Recall that the company started operations on November 1, 2017, so all of the opening balances are zero. Additional information: 1. Recall from Chapter 15 that the company bought kitchen equipment (a commercial oven) for $17,000 on November 1, 2017, and signed a $12,000 note payable to help pay for it. The terms provide for semiannual fixed principal payments of $2,000 on May 1 and November 1 of each year, plus interest of 5%. All other furniture, fixture, and equipment were purchased during the year for cash. 2. Recall from Chapter 14 that the company originally issued 25,930 common shares for $25,930, of which 750 shares were repurchased from the lawyer for $500. COOKIE & COFFEE CREATIONS INC. Income Statement Year Ended October 31, 2018 Sales $462,500 Cost of goods sold 231,250 Gross profit 231,250 Operating expenses Salaries and wages expense $92,500 Depreciation expense 9,850 Other operating expenses 35,987 138,337 Income from operations Other expenses Interest expense 413 Income before income tax 92,500 Income tax expense 18,500 Net income $74,000 92.913 $32,219 3,250 17,897 6,300 $59.666 99,700 (9,850) 89,850 $149,516 COOKIE & COFFEE CREATIONS INC. Balance Sheet October 31, 2018 Assets Current Assets Cash Accounts receivable Inventory Prepaid Rent Property, Plant, and Equipment Equipment Accumulated depreciation equipment Total assets Liabilities and Stockholders' Equity Current Liabilities Accounts payable Income tax payable Dividends payable Salaries and wages payable Interest payable Note payable-current portion Long-term Liabilities Note payable-long-term portion Total liabilities Stockholders' Equity Paid-in capital Preferred stock, 2,800 shares issued and outstanding $14,000 Common stock, 25,930 shares issued, 25,180 outstanding 25,930 Retained earnings Total paid-in capital and retained earnings Less: Treasury stock-common (750 shares), at cost Total stockholders' equity Total liabilities and stockholders' equity $5,848 18.500 700 2,250 188 4000 $31.486 6,000 37,486 39,930 72.600 112,530 (500) 112,030 $149,516 (a) Your answer is partially correct. Try again. Prepare a statement of cash flows for Cookie & Coffee Creations Inc. for the year ended October 31, 2018, using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000). If answer is 0, please enter 0. Do not leave any fields blank.) Prepare PL I LA TUW TUI OUKE & wollee VIECLIVIIS ITIL. TUI ile yedi el TCU ULLUULISI, 2016, USilty wiem COOKIE & COFFEE CREATIONS INC. Cash Flow Statement Year Ended October 31, 2018 Cash Flows from Operating Activities 74000 Net Income Adjustment to reconcile net income to Net Cash Provided by Operating Activities Depreciation Expense Increase in Accounts Receivable | Increase in Inventory | Increase in Prepaid Rent | Increase in Accounts Payable 5848 | Increase in Income Taxes Payable 18500 Increase in Accounts Payable 700 Increase in Interest Payable 2250 T Net Cash Provided by Operating Activities Cash Flows from Investing Activities T Purchase of Equipment 1 .99700 Net Cash Used by Investing Activities Cash Flows from Financing Activities T issue of Common Stock 25430 Issue of Preferred Stock 1 14000 Principal Repayment of Notes Payable T 6000 | Payment of Dividends -1400 Net Cash Provided by Financing Activities Net Increase in Cash Cash, November 1, 2017 Cash, October 31, 2018 Noncash Investing and Financing Activities Loss on Disposal of Plant Assets
