Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Dec. 31, 20Y8 Dec. 31, 20Y7 Assets Cash $53,020 $65,110 Accounts receivable (net) 81,470 87,770 Inventories 116,380 108,780 Prepaid expenses 4,740 3,300 Equipment 237,070 194,910

Dec. 31, 20Y8 Dec. 31, 20Y7
Assets
Cash $53,020 $65,110
Accounts receivable (net) 81,470 87,770
Inventories 116,380 108,780
Prepaid expenses 4,740 3,300
Equipment 237,070 194,910
Accumulated depreciation-equipment (61,640) (47,800)
Total assets $431,040 $412,070
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors) $90,520 $86,120
Mortgage note payable 0 123,620
Common stock, $1 par 14,000 9,000
Paid-in capital in excess of par-common stock 211,000 116,000
Retained earnings 115,520 77,330
Total liabilities and stockholders equity $431,040 $412,070

Additional data obtained from the income statement and from an examination of the accounts in the ledger for 20Y8 are as follows:

  1. Net income, $97,770.
  2. Depreciation reported on the income statement, $30,020.
  3. Equipment was purchased at a cost of $58,340 and fully depreciated equipment costing $16,180 was discarded, with no salvage realized.
  4. The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty.
  5. 5,000 shares of common stock were issued at $20 for cash.
  6. Cash dividends declared and paid, $59,580.

Required:

Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

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

Basic Food And Beverage Cost Control

Authors: Jack E. Miller, David K. Hayes

1st Edition

ISBN: 0471579181, 978-0471579182

More Books

Students also viewed these Accounting questions

Question

Time: 0.28Time: 0.28\fTime: 0.28 8888

Answered: 1 week ago