Spreadsheet and Statement of Cash Flows

The following information was taken from Lamberson Company's accounting records:

	Account Balances
Account Titles	January 1, 2016	December 31, 2016
Debits
Cash	$ 1,400	$ 2,400
Accounts Receivable (net)	2,800	2,690
Marketable Securities (at cost)	1,700	3,000
Allowance for Change in Value	500	800
Inventories	8,100	7,910
Prepaid Items	1,300	1,710
Investments (long-term)	7,000	5,400
Land	15,000	15,000
Buildings and Equipment	32,000	46,200
Discount on Bonds Payable		290
	$69,800	$85,400
Credits
Accumulated Depreciation	$16,000	$16,400
Accounts Payable	3,800	4,150
Income Taxes Payable	2,400	2,504
Wages Payable	1,100	650
Interest Payable		400
Note Payable (long-term)	3,500
12% Bonds Payable		10,000
Deferred Taxes Payable	800	1,196
Convertible Preferred Stock, $100 par	9,000
Common Stock, $10 par	14,000	21,500
Additional Paid-in Capital	8,700	13,700
Unrealized Increase in Value of Marketable Securities	500	800
Retained Earnings	10,000	14,100
	$69,800	$85,400

Additional information for the year:

a.

Sales		$ 39,930
Cost of goods sold		(19,890)
Depreciation expense		(2,100)
Wages expense		(11,000)
Other operating expenses		(1,000)
Bond interest expense		(410)
Dividend revenue		820
Gain on sale of investments		700
Loss on sale of equipment		(200)
Income tax expense		(2,050)
Net income		$ 4,800

b. Dividends declared and paid totaled $700.

c. On January 1, 2016, convertible preferred stock that had originally been issued at par value were converted into 500 shares of common stock. The book value method was used to account for the conversion.

d. Long-term nonmarketable investments that cost $1,600 were sold for $2,300.

e. The long-term note payable was paid by issuing 250 shares of common stock at the beginning of the year.

f. Equipment with a cost of $2,000 and a book value of $300 was sold for $100. The company uses one Accumulated Depreciation account for all depreciable assets.

g. Equipment was purchased at a cost of $16,200.

h. The 12% bonds payable were issued on August 31, 2016, at 97. They mature on August 31, 2026. The company uses the straight-line method to amortize the discount.

i. Taxable income was less than pretax accounting income, resulting in a $396 increase in deferred taxes payable.

j. Short-term marketable securities were purchased at a cost of $1,300. The portfolio was increased by $300 to a $3,800 fair value at year-end by adjusting the related allowance account.

Required

1. Prepare a spreadsheet to support Lamberson Company's 2016 statement of cash flows. Use the minus sign to indicate cash outflows, a decrease in cash or cash payments.

Worksheet Entries
	Debit	Credit
Cash Flows from Operating Activities:
Net income
Add: Depreciation expense
Add: Decrease in accounts receivable
Add: Decrease in inventories
Add: Increase in accounts payable
Add: Increase in income taxes payable
Add: Increase in interest payable
Add: Loss on sale of equipment
Add: Increase in deferred taxes payable
Add: Bond discount amortization
Less: Increase in prepaid items
Less: Decrease in wages payable
Less: Gain on sale of investments
Cash Flows from Investing Activities:
Payment for purchase of short-term marketable securities
Proceeds from sale of long-term investments
Proceeds from sale of equipment
Payment for purchase of equipment
Cash Flows from Financing Activities:
Payment of dividends
Proceeds from issuance of 12% bonds
Investing and Financing Activities Not Affecting Cash:
Issuance of common stock to convert preferred stock
Conversion of preferred stock to common stock
Issuance of common stock to pay long-term note
Payment of long-term note by issuing common stock
Net increase in cash
Totals