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Graphene Plastics Company imports graphite from Australia for conversion to graphene to make hockey sticks in Canada. As CEO, you are busy preparing a loan
Graphene Plastics Company imports graphite from Australia for conversion to graphene to make hockey sticks in Canada. As CEO, you are busy preparing a loan application, which asks for a cash flow statement for the most recent fiscal period. You have the following financial information.
GRAPHENE PLASTICS COMPANY Comparative Statement of Financial Position | |||||
Oct. 31, 2020 | Oct. 31, 2019 | ||||
Assets | |||||
Cash | $76,300 | $79,600 | |||
Accounts receivable (net) | 120,300 | 134,600 | |||
Inventory | 210,700 | 174,900 | |||
Total current assets | 407,300 | 389,100 | |||
Equipment | 301,200 | 228,100 | |||
Accumulated depreciation | (143,600 | ) | (171,100 | ) | |
Total Assets | $564,900 | $446,100 | |||
Liabilities and shareholders equity | |||||
Current liabilities: | |||||
Accounts payable | $80,800 | $64,500 | |||
Dividends payable | 17,000 | 22,200 | |||
Total current liabilities | 97,800 | 86,700 | |||
Loan payable | 107,900 | 125,300 | |||
Total liabilities | 205,700 | 212,000 | |||
Common shares | 108,900 | 108,900 | |||
Retained earnings | 250,300 | 125,200 | |||
Total shareholders equity | 359,200 | 234,100 | |||
Total liabilities and shareholders equity | $564,900 | $446,100 |
GRAPHENE PLASTICS COMPANY Statement of Income For the year ended October 31, 2020 | |||||
Sales revenue | $608,600 | ||||
Cost of goods sold | 264,600 | ||||
Gross profit | 344,000 | ||||
Expenses | |||||
Wages expense | 49,800 | ||||
Utilities expense | 20,200 | ||||
Depreciation expense | 25,200 | ||||
Rent expense | 15,000 | ||||
Interest expense | 9,000 | ||||
Total expenses | 119,200 | ||||
Loss on sale of equipment | 8,900 | ||||
Net income | $215,900 |
Additional information: During the year, Graphene sold a piece of its equipment. The equipment sold had originally cost $73,700 and was sold for $12,100.
Using the information above, prepare Graphene's statement of cash flows for the year ended October 31, 2020, 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).) Graphene Plastics Company Statement of Cash Flows, Indirect Method For the Year Ended October 31, 2020 Cash Flows from Operating Activities Net Income $ 215900 Depreciation Expense 25200 Loss on Sale of Equipment Loss on Sale of Equipment Decrease in Accounts Receivable Decrease in Inventory 16300 Cash Flows from Operating Activities $ Cash Flows from Investing Activities Proceeds from the sale of Equipment Cash Flows from Operating Activities $ Cash Flows from Investing Activities Proceeds from the Sale of Equipment - Decrease in Inventory Cash Flows from Investing Activities Cash Flows from Financing Activities Dividend Paid Repayment of Loan Payable Net Change in Cash Cash Flows from Financing Activities $ Net Change in Cash $ Opening Cash Ending Cash $ Net Change in Cash Cash Flows from Financing Activities $ Net Change in Cash ta Opening Cash Ending Cash $ Supplemental Cash Flow information: Cash paid for interest $
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