Question
Whispering Winds Inc. had the following statement of financial position at the end of operations for 2016: WHISPERING WINDS INC. Statement of Financial Position December
Whispering Winds Inc. had the following statement of financial position at the end of operations for 2016:
WHISPERING WINDS INC. Statement of Financial Position December 31, 2016 | |||||||
Cash | $20,000 | Accounts payable | $30,000 | ||||
Accounts receivable | 21,200 | Bonds payable | 41,000 | ||||
FV-NI investments | 32,000 | Common shares | 100,000 | ||||
Equipment (net) | 81,000 | Retained earnings | 23,200 | ||||
Land | 40,000 | ||||||
$194,200 | $194,200 |
During 2017, the following occurred:
1. | Whispering Winds liquidated its FV-NI investments portfolio at a loss of $9,000. |
2. | A parcel of land was purchased for $48,000. |
3. | An additional $48,000 worth of common shares was issued. |
4. | Dividends totalling $14,000 were declared and paid to shareholders. |
5. | Net income for 2017 was $31,000, including $12,000 in depreciation expense. |
6. | Land was purchased through the issuance of $60,000 in additional bonds. |
7. | At December 31, 2017, Cash was $70,200; Accounts Receivable was $42,000; and Accounts Payable was $40,000. |
A) Prepare the statement of financial position as it would appear at December 31, 2017. (List Assets in order of liquidity.) WHISPERING WINDS INC. Statement of Financial Position
Date:
ASSETS
_________
_________
__________
__________
Total__________
Liabilities and Shareholders Equity
_________
_________
__________
__________
Total ______
B) Prepare a statement of cash flows for the year ended December 31, 2017 using the indirect method. Assume dividends paid are treated as financing activities. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
WHISPERING WINDS INC. Statement of Cash Flows
Date:
C) Calculate the current and acid test ratios for 2016 and 2017. (Round answers to 2 decimal places, e.g. 52.75.)
2017
Current ratio_____
Acid test ratios______
2016
Current ratio_______
Acid test ratios______
|
D) Calculate Aeros free cash flow and the current cash debt coverage ratio for 2017. (Round current cash debt coverage ratio to 2 decimal places, e.g. 52.75. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Free cash flow________
Current cash debt coverage ratio__________
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