Exercise 23-21

Below is the comparative balance sheet for Pharoah Corporation.

		Dec. 31, 2017			Dec. 31, 2016
Cash		$16,400			$20,900
Short-term investments		24,700			18,800
Accounts receivable		42,600			44,800
Allowance for doubtful accounts		(1,800	)		(1,900	)
Prepaid expenses		4,300			2,500
Inventory		82,000			65,100
Land		50,500			50,500
Buildings		125,400			74,100
Accumulated depreciationbuildings		(30,000	)		(22,900	)
Equipment		53,300			45,600
Accumulated depreciationequipment		(19,200	)		(15,700	)
Delivery equipment		38,700			38,700
Accumulated depreciationdelivery equipment		(22,200	)		(20,500	)
Patents		14,800			0
		$379,500			$300,000
Accounts payable		$26,000			$16,200
Short-term notes payable (trade)		4,000			6,000
Accrued payables		3,000			4,500
Mortgage payable		73,300			53,400
Bonds payable		50,100			62,700
Common stock		140,300			101,400
Paid-in capital in excess of par		10,000			3,900
Retained earnings		72,800			51,900
		$379,500			$300,000

Dividends in the amount of $15,000 were declared and paid in 2017. From this information, prepare a worksheet for a statement of cash flows. Make reasonable assumptions as appropriate. The short-term investments are considered available-for-sale and no unrealized gains or losses have occurred on these securities.

PHAROAH CORPORATION WORKSHEET FOR PREPARATION OF STATEMENT OF CASH FLOWS For the Year Ended December 31, 2017
				2017 Reconciling Items
Debits		Balance at 12/31/16		Debit		Credit		Balance at 12/31/17
Cash		$20,900						$16,400
Short-term investments		18,800						24,700
Accounts receivable		44,800						42,600
Prepaid expenses		2,500						4,300
Inventory		65,100						82,000
Land		50,500						50,500
Buildings		74,100						125,400
Equipment		45,600						53,300
Delivery equipment		38,700						38,700
Patents								14,800
Total debits		$361,000						$452,700
Credits
Accounts payable		$16,200						$26,000
Notes payable		6,000						4,000
Accrued liabilities		4,500						3,000
Allowance for doubtful accounts		1,900						1,800
Accumulated DepreciationBuilding		22,900						30,000
Accumulated DepreciationEquipment		15,700						19,200
Accumulated DepreciationDelivery Equipment		20,500						22,200
Mortgage payable		53,400						73,300
Bonds payable		62,700						50,100
Common stock		101,400						140,300
Paid-in capital in excess		3,900						10,000
Retained earnings		51,900						72,800
Total credits		$361,000						$452,700

prepare the following:

Pharoah Corporation Statement of Cash Flows Effects