Statement of Cash Flows

Instructions

Amount Descriptions

Statement of Cash Flows

Concluding Question

X

Instructions

Swasey Company provided the following partial comparative balance sheets and the income statement for 20X2.

Swasey Company

Comparative Balance Sheets

At December 31, 20X1 and 20X2

1		20X1	20X2
2	Current assets:
3	Cash	$229,500.00	$687,000.00
4	Accounts receivable	$753,000.00	$578,500.00
5	Inventories	305,000.00	324,000.00
6	Long-term assets:
7	Plant and equipment	2,195,000.00	2,146,000.00
8	Accumulated depreciation	(1,205,000.00)	(1,286,000.00)
9	Land	1,004,000.00	1,430,500.00
10	Total assets	$3,281,500.00	$3,880,000.00
11	Current liabilities:
12	Wages payable	$701,000.00	$516,000.00
13	Long-term liabilities:
14	Bonds payable	0.00	383,000.00
15	Mortgage payable	97,500.00	0.00
16	Total liabilities	$798,500.00	$899,000.00
17	Stockholders equity:
18	Common stock	380,000.00	380,000.00
19	Paid-in capital in excess of par	283,000.00	283,000.00
20	Retained earnings	1,820,000.00	2,318,000.00
21	Total stockholders equity	2,483,000.00	2,981,000.00
22	Total liabilities and stockholders equity	$3,281,500.00	$3,880,000.00

Swasey Company

Income Statement

For the Year Ended December 31, 20X2

1	Revenues	$3,000,000.00
2	Gain on sale of equipment	91,000.00
3	Cost of goods sold	(1,910,000.00)
4	Depreciation expense	(263,000.00)
5	Interest expense	(8,500.00)
6	Net income	$909,500.00

During the year, Swasey Company sold equipment with a book value of $277,500 for $368,500 (original purchase cost of $459,500). New equipment was purchased.

	Required:
1.	Prepare a statement of cash flows for Swasey for 20X2.
2.	Reflect on the relationship between the statement of cash flows and the change in cash.

2:

1. Prepare a statement of cash flows for Swasey for 20X2. (Note: Use a minus sign to indicate any decreases in cash or cash outflows. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.) Swasey Company Statement of Cash Flows For the Year Ended December 31, 20X2 1 Cash flows from operating activities: 3 Add (deduct) adjusting items: 10 Cash flows from investing activities: 15 Cash flows from financing activities