Question
Using the following account balances, prepare all sections of a completed statement of cash flows for the year ended 2018. For the operating section, use
Using the following account balances, prepare all sections of a completed statement of cash flows for the year ended 2018. For the operating section, use the indirect method.
2018 2017
Cash $ 30,000 $35,000
Accounts receivable, net 55,000 45,000
Inventory 65,000 45,000
Prepaid insurance 15,000 25,000
Equipment 90,000 75,000
Accumulated depreciation (18,000) (8,000)
Land 70,000 40,000
Total $307,000 $257,000
Accounts payable $ 65,000 $ 52,000
Accrued expenses payable 15,000 18,000
Notes payable, bank long-term 0 23,000
Bonds payable 30,000 0
Common stock, $10 par 189,000 159,000
Retained Earnings 8,000 5,000
Total $307,000 $257,000
Land was acquired for $30,000 in exchange for common stock at par: all equipment purchased is for cash. Equipment costing $10,000(40% depreciated) was sold for $3000. Cash dividends of $10,000 were declared and paid during 2018.
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