Spreadsheet and Statement

The following 2016 information is available for Stewart Company:

Condensed Income Statement for 2016

Sales $9,000

Cost of goods sold (6,000)

Other expenses (2,000)

Loss on sale of equipment (260)

Gain on sale of land 400

Net income $1,140

Comparative Balance Sheets

December 31,2015 December 31,2016

Cash $700 $1,130

Accounts receivable 450 310

Inventory 350 400

Land 300 500

Equipment 1,600 1,800

Less: Accumulated depreciation (200) (150)

Total Assets $3,200 $3,990

Accounts payable $600 $750

Bonds payable (due 1/1/2018) 1,000 1,000

Common stock, $10 par 900 1,400

Retained earnings 700 840

Total Liabilities and Shareholders' Equity $3,200 $3,990

Partial additional information:

• The equipment that was sold for cash had cost $400 and had a book value of $300.
• Land that was sold brought a cash price of $530.
• Fifty shares of stock were issued at par.

Required:

Making whatever additional assumptions that are necessary,

1. Prepare a spreadsheet to support a 2016 statement of cash flows for Stewart. If an amount is zero, enter "0".

STEWART COMPANY

Cash Flows Worksheet

For Year Ended December 31, 2016

Balances 12/31/2015 Balances 12/31/2016 Balances Change Worksheet Entries Debit Worksheet Entries Credit

Debits:

Cash ______ _______ _______ ________

Noncash Accounts:

Accounts receivable ______ _______ _______ _________

Inventory ______ _______ _______ ________

Land ______ _______ _______ ________ _________

Equipment ______ _______ _______ ________ _________

Totals ______ _______ _______

Credits:

Accumulated depreciation ______ _______ _______ ________ __________

Accounts payable ______ _______ _______ __________

Bonds pay. (due 1/1/2021) ______ _______ ________

Common stock, $10 par ______ _______ _______ ___________

Retained earnings _______ _______ _______ ___________ __________

Totals _______ _______ _______ ________ _________

Cash Flow From Operating Activities

Net income _______

Add: Decrease in accounts receivable _______

Add: Loss on sale of equipment _______

Add: Depreciation expense _______

Add: Increase in accounts payable _______

Less: Increase in inventory ________

Less: Gain on sale of land ________

Cash Flows From Investing Activities

Proceeds from sale of land _______

Payment for purchase of land _________

Proceeds from sale of equipment _______

Payment for purchase of equipment _________

Cash Flows From Financing Activities

Proceeds from issuance of common stock _______

Payment of dividends __________

Net increase in cash __________

Totals _______ __________

2. Prepare the statement of cash flows. Use the minus sign to indicate cash outflows, a decrease in cash or cash payments.

STEWART COMPANY

Statement of Cash Flows

For Year Ended December 31, 2016

Operating Activities:

Net Income:

Adjustment for noncash income items:

ADD: Deprecation Expense:

ADD: Loss on Sale of Equipment:

LESS: Gain on Sale of Land:

Adjustments for cash flow effects

from working capital items:

Decrease in Accounts Receivable:

Increase in Inventory:

Increase in Accounts Payable:

Net Cash Provided by Operating Activities:

Investing Activities:

Proceeds of Sale of Land:

Payment for Purchase of Land:

Proceeds from Sale of Equipment:

Payment for Purchase of Equipment:

Net Cash Used for Investing Activities:

Financing Activities:

Proceeds from Issuance of Common Stock:

Payment of Dividends:

Net Cash Used for Financial Activities:

Net Increase for Cash:

Cash, January 1, 2016

Cash, December 31, 2016