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Required: 1. Prepare a complete statement of cash flows using a spreadsheet. 2.Prepare a complete statement of cash flows; report its operating activities according to
Required: 1. Prepare a complete statement of cash flows using a spreadsheet.
2.Prepare a complete statement of cash flows; report its operating activities according to the direct method.
Please show all the calculations work! Thank you for your help!
FORTEN COMPANY Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets $ 64,900 $ 83,500 60,625 261,800 2,095 408,020 118,000 80,870 290,656 1,310 437,736 147,500 41,625 51,000 $ 543,611 $ 475,020 Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total 1liabilities and equity $ 63,141 $ 129,675 8,000 137,675 58,750 196,425 13,000 76,141 60,000 136,141 182,750 47,500 177,220 160,250 118,345 $ 543,611 $ 475,020 FORTEN COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses $632,500 295,000 337,500 Depreciation expense 30,750 142,400 173,150 Other expenses Other gains (losses) (15, 125) 149,225 38,250 $ 110,975 Loss on sale of equipment Income before taxes Income taxes expense Net income Additional Information on Year 2017 Transactions a. The loss on the cash sale of equipment was $15,125 (details in b). b. Sold equipment costing $76,875, with accumulated depreciation of $40,125, for $21,625 cash c. Purchased equipment costing $106,375 by paying $50,000 cash and signing a long-term note payable for the balance d. Borrowed $5,000 cash by signing a short-term note payable. e. Paid $55,125 cash to reduce the long-term notes payable f. Issued 3,500 shares of common stock for $20 cash per share. 9. Declared and paid cash dividends of $52,100. FORTEN COMPANY Spreadsheet for Statement of Cash Flows For Year Ended December 31, 2017 Analysis of Changes December 31, 2016 Debit Credit December 31, 2017 Balance sheet-debit Cash Accounts receivable Inventory Prepaid expenses Equipment 83,500 60,625 261,800 2,095 118,000 526,020 64,900 80,870 290,656 1,310 20,245 28,856 785 437,736 Balance sheet-credit Accumulated depreciation- Equipment Accounts payable Short-term notes payable Long-term notes payable Common stock, $5 par value Paid-in capital in excess of par value, common stock Retained earnings 51,000 129,675 8,000 58,750 160,250 66,534 63,141 5,000 13,000 22,500 182,750 47,500 47,500 118,345 526,020 306,391Step by Step Solution
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