Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Groton Company Comparative Balance Sheet December 31, 2011 and 2010 2011 2010 $ Assets Cash Accounts receivable Inventory Prepaid expenses 1 306 $ 12 229
Groton Company Comparative Balance Sheet December 31, 2011 and 2010 2011 2010 $ Assets Cash Accounts receivable Inventory Prepaid expenses 1 306 $ 12 229 158 196 8 6 Total current assets 473 443 Property, plant, and equipment Less accumulated depreciation 509 (85) 430 (71) Net property, plant, and equipment 424 359 Long-term investments 25 32 Total assets $ 922 $ 834 $ 301 Liabilities and Stockholders' equity Accounts payable Accrued liabilities Income taxes payable 70 $ 225 63 72 Total current liabilities Bonds payable 443368 198 172 Total liabilities 641 540 Common stock Retained earnings 163 118 202 Total stockholders' equity 281 294 Total liabilities and stockholders' equity $ 922 $ 834 Groton Company Income Statement For the Year Ended December 31, 2011 Sales $ 754 Cost of goods sold 448 306 Gross margin Selling and administrative expenses 222 Net operating income Non operating items: Gain on sale of investments Loss on sale of equipment $6 Income before taxes Income taxes Net income $ 65 During 2011, Groton sold some equipment for $19 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $7 when purchased several years ago. A cash dividend was paid during 2011 and the company repurchased $39 of its own stock. Groton did not retire any bonds during 2011 Required: 1. Using the indirect method, determine the net cash provided by (used in) operating activities for 2011 (Negative amount should be entered with a minus sign.) Net cash used in operating activities $ 119 2. Using the information in (1) above, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for 2011. (Amounts to be deducted and negative amounts should be indicated with a minus sign.) Groton Company Statement of Cash Flows - Indirect Method For the Year Ended December 31, 2011 Operating activities: Net income Adjustments to convert net income to cash basis: Depreciation Gain on sale of investments Loss on sale of equipment Investing activities: Financing activities: Financing activities: Cash balance, January 1, 2011 Cash balance, December 31, 2011 | $ 90
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started