Preparing a Cash Flow Worksheet

Guccii Corporations recent comparative balance sheet and income statement follow:

Balance Sheets, December 31	2019	2020
Assets
Cash and cash equivalents	$30,000	$43,000
Investments, short-term	0	6,000
Accounts receivable, net	34,000	42,000
Merchandise inventory	20,000	30,000
Investments, long-term	0	20,000
Plant assets, net	120,000	118,000
Patents	6,000	5,400
Other assets	14,000	14,000
Total assets	$224,000	$278,400
Liabilities and Stockholders Equity
Accounts payable	$24,000	$44,000
Accrued expenses payable	0	17,400
Bonds payable	80,000	40,000
Common stock, par $10	70,000	80,000
Additional paid-in capital	0	9,000
Retained earnings	50,000	88,000
Total liabilities and stockholders equity	$224,000	$278,400

Income Statement, For Year Ended December 31	2020
Sales revenue	$208,000
Cost of goods sold	(110,000)
Depreciation expense	(16,000)
Patent amortization	(600)
Other operating expenses	(35,400)
Net income	$46,000

Additional information for 2020 1. Retired bonds paying $40,000 cash. 2. Bought long-term debt investment in securities, $20,000 cash. 3. Purchased a plant asset, $14,000 cash. 4. Purchased short-term investment in securities (not held in a trading account), $6,000 cash. 5. Declared and paid cash dividends, $8,000. 6. Issued capital stock, 1,000 shares at $19 cash per share

a. Prepare a cash flow worksheet

Comparative Balance Sheets
	2019	Dr.	Cr.	2020
Cash and cash equivalents	$30,000	Answer	Answer	Answer
Investments, short-term	-	Answer	Answer	Answer
Accounts receivable, net	34,000	Answer	Answer	Answer
Merchandise inventory	20,000	Answer	Answer	Answer
Investments, long-term	-	Answer	Answer	Answer
Plant assets, net	120,000	Answer	Answer	Answer
Patents	6,000	Answer	Answer	Answer
Other assets	14,000	Answer	Answer	Answer
Total assets	224,000			Answer
Accounts payable	24,000	Answer	Answer	Answer
Accrued expenses payable	-	Answer	Answer	Answer
Bonds payable	80,000	Answer	Answer	Answer
Common stock, no par	70,000	Answer	Answer	Answer
Additional paid-in capital		Answer	Answer	Answer
Retained earnings	50,000	Answer	Answer	Answer
Total liabilities and stockholders' equity	$224,000			Answer
Cash Flows from Operating Activities
Net income		Answer	Answer
Depreciation expense		Answer	Answer
Amortization of patent		Answer	Answer
Increase in accounts receivable, net		Answer	Answer
Increase in inventory		Answer	Answer
Increase in accounts payable		Answer	Answer
Increase in accrued expenses payable		Answer	Answer
Cash Flows from Investing Activities
Purchase of short-term investments		Answer	Answer
Purchase of long-term investments		Answer	Answer
Purchase of plant assets		Answer	Answer
Cash Flows from Financing Activities
Retirement of bonds		Answer	Answer
Issuance of stock		Answer	Answer
Dividend payment		Answer	Answer
Net cash increase		Answer	Answer
Total		Answer	Answer

Prepare a reconciliation of the total of the three sections of net cash flows from operating, investing, and financing activities to the change in cash.

Cash Flow Reconciliation	Amount
Net cash provided (used) by operating activities	Answer
Net cash provided (used) by investing activities	Answer
Net cash provided (used) by financing activities	Answer
Net change in cash and cash equivalents	Answer
Cash and cash equivalents, January 1, 2020	Answer
Cash and cash equivalents, December 31, 2020	Answer