Question
[The following information applies to the questions displayed below.] Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This
[The following information applies to the questions displayed below.]
Comparative financial statements for Weaver Company follow:
Weaver Company Comparative Balance Sheet at December 31 | ||||||||
This Year | Last Year | |||||||
Assets | ||||||||
Cash | $ | 8 | $ | 12 | ||||
Accounts receivable | 307 | 229 | ||||||
Inventory | 159 | 195 | ||||||
Prepaid expenses | 8 | 6 | ||||||
Total current assets | 482 | 442 | ||||||
Property, plant, and equipment | 513 | 433 | ||||||
Less accumulated depreciation | (85 | ) | (72 | ) | ||||
Net property, plant, and equipment | 428 | 361 | ||||||
Long-term investments | 28 | 34 | ||||||
Total assets | $ | 938 | $ | 837 | ||||
Liabilities and Stockholders' Equity | ||||||||
Accounts payable | $ | 304 | $ | 225 | ||||
Accrued liabilities | 72 | 79 | ||||||
Income taxes payable | 74 | 65 | ||||||
Total current liabilities | 450 | 369 | ||||||
Bonds payable | 197 | 172 | ||||||
Total liabilities | 647 | 541 | ||||||
Common stock | 163 | 200 | ||||||
Retained earnings | 128 | 96 | ||||||
Total stockholders equity | 291 | 296 | ||||||
Total liabilities and stockholders' equity | $ | 938 | $ | 837 | ||||
Weaver Company Income Statement For This Year Ended December 31 | ||||||
Sales | $ | 754 | ||||
Cost of goods sold | 445 | |||||
Gross margin | 309 | |||||
Selling and administrative expenses | 220 | |||||
Net operating income | 89 | |||||
Nonoperating items: | ||||||
Gain on sale of investments | $ | 7 | ||||
Loss on sale of equipment | (3 | ) | 4 | |||
Income before taxes | 93 | |||||
Income taxes | 24 | |||||
Net income | $ | 69 | ||||
During this year, Weaver sold some equipment for $18 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $6 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $37 of its own stock. This year Weaver did not retire any bonds.
Required:
1. Using the indirect method, determine the net cash provided by/used in operating activities for this year.
2. Using the information in (1) above, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. (List any deduction in cash and cash outflows as negative amounts.)
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started