Following are comparative balance sheets for Millco Inc. at January 31 and February 28, 2020: MILLCO INC. Balance Sheets February 28 and January 31, 2020 February 28 January 31 $ 58,800 89,600 113,400 $261,800 $ 51,800 74,200 131,600 $257,600 232,400 (33,600) $ 460,600 212,800 (29,400) $441,000 Assets Cash Accounts receivable Merchandise inventory Total current assets Plant and equipment: Production equipment Less: Accumulated depreciation Total assets Liabilities Accounts payable Short-term debt Other accrued liabilities Total current liabilities Long-term debt Total liabilities Stockholders' Equity Common stock, no par value, 56,000 shares authorized, 42,000 and 39,200 shares issued, respectively Retained earnings: Beginning balance Net income for month Dividends Ending balance Total stockholders' equity Total liabilities and stockholders' equity $ 51,800 61,600 29,400 $142,800 46,200 $ 189,000 $ 57,400 61,600 33,600 $152,600 64,400 $ 217,000 $145,600 $134,400 $ 89,600 50,400 (14,000) $126,000 $271,600 $ 460,600 $ 60,200 40,600 (11,200 $ 89,600 $ 224,000 $441,000 Required: a. Calculate the change that occurred in cash during the month. You may assume that the change in each balance sheet amount is due to a single event (for example, the change in the amount of production equipment is not the result of both a purchase and sale of equipment). Because the retained earnings section of the balance sheet is, in and of itself, an analysis of the change in the retained earnings account for the month, the row for net income and dividends should be entered as the February amount and not the change. Use the space to the right of the January 31 data to enter the difference between the February 28 and January 31 amounts of each balance sheet item. b. Prepare a statement of cash flows that explains above changes? Change MILLCO INC. Balance Sheets January 31 and February 28, 2020 February 28 January 31 Assets Cash $ 58,800 $ 51,800 Accounts receivable 89,600 74,200 Merchandise inventory 113,400 131,600 Total current assets $ 261,800 $ 257,600 Plant and equipment: Production equipment 232.400 212,800 Less: Accumulated depreciation (33,600) (29,400) Total assets $ 460,600 $ 441,000 51,800 $ 57,400 61,600 61,600 29,400 33.600 $ 142,800 $ 152,600 46,200 64,400 $ 189,000 $ 217,000 Liabilities Accounts payable Short-term debt Other accrued liabilities Total current liabilities Long-term debt Total liabilities Stockholders' Equity Common stock Retained earnings: Beginning balance Net income for month Dividends Ending balance Total stockholders' equity Total liabilities and stockholders' equity $ 145,600 $ 134,400 $ 89,600 $ 60,200 50,400 40,600 (14,000) (11,200) $ 126,000 $ 89,600 $ 271,600 $ 224,000 $ 441,000 Complete this question by entering your answers in the tabs below. Required A Required B Prepare a statement of cash flows that explains above changes? (Amounts to be deducted should be indicated by a minus sign.) MILLCO INC. Statement of Cash Flows For the Month Ended February 28, 2020 Cash flows from operating activities: Add (deduct) items not affecting cash: $ Cash flows from investing activities: Cash flows from financing activities: 0 $
