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The comparative balance sheet of Orange Angel Enterprises Inc. at December 31, 2018 and 2077, is as follows: Dec 31, 2018 Dec 31, 2017 Assets
The comparative balance sheet of Orange Angel Enterprises Inc. at December 31, 2018 and 2077, is as follows: Dec 31, 2018 Dec 31, 2017 Assets Cash $66,420 $ $81.560 $ Accounts receivable (net) 102,050 109.950 Merchandise inventory 145,780 136,280 Prepaid expenses 5,940 4,130 Equipment 296,980 244,160 Accumulated depreciation equipment (77,210) (59,880) ) Total assets $539.950 $516,200 Liabilities and Stockholders' Equity ' Accounts payable (merchandise creditors) $113,390 $107.890 Mortgage note payable 0 154,860 Common stock, $1 par 18,000 11,000 Excess of paid-in capital over par 265,000 146.000 Retained earnings 143.570 96.450 Total liabilities and stockholders' equity $539,960 $516,200 Additional data obtained from the income statement and from an examination of the accounts in the ledger for 20Y8 are as follows: a. Net income, $120.630. b. Depreciation reported on the income statement, $37,600. C. Equipment was purchased at a cost of $73,090, and fully depreciated equipment costing $20,270 was discarded with no salvage realized. d. The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty. e. 7,000 shares of common stock were issued at $18 for cash. f. Cash dividends declared and paid, 573,510. Required: Prepare a statement of cash flows, using the indirect method of presenting cash flows from (used for) operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash or any negative adjustments. Orange Angel Enterprises Inc. Statement of Cash Flows For the Year Ended December 31, 2018 Cash flows from (used for) operating activities: ) Net income 120,630 Adjustments to reconcile net income to net cash flows from (used for) operating activities: Depreciation 37.600 Changes in current operating assets and liabilities: Decrease in inventory -9.500 X Decrease in accounts payable 5,500 X Decrease in accounts payable 7,900 x X Decrease in prepaid expenses X -1.810 x 160,320 -73,090 Net cash flows from operating activities Cash flows from (used for) investing activities: ) : Cash paid for equipment Net cash flows used for investing activities Cash flows from (used for) financing activities: Cash received from issuing common stock Cash dividends -73,090 126,000 -73,510 -154,860 Cash paid to retire mortgage note payable Net cash flows from financing activities -102.370 Net increase in cash X -15,140 81.560 Cash balance, January 1, 2018 Cash balance, December 31, 2018 66,420
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