Question

In: Accounting

Golden Corp., a merchandiser, recently completed its 2018 operations. For the year, (1) all sales are...

Golden Corp., a merchandiser, recently completed its 2018 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow.

GOLDEN CORPORATION
Comparative Balance Sheets
December 31, 2018 and 2017
2018 2017
Assets
Cash $ 164,000 $ 107,000
Accounts receivable 83,000 71,000
Inventory 601,000 526,000
Total current assets 848,000 704,000
Equipment 335,000 299,000
Accum. depreciation—Equipment (158,000 ) (104,000 )
Total assets $ 1,025,000 $ 899,000
Liabilities and Equity
Accounts payable $ 87,000 $ 71,000
Income taxes payable 28,000 25,000
Total current liabilities 115,000 96,000
Equity
Common stock, $2 par value 592,000 568,000
Paid-in capital in excess of par value, common stock 196,000 160,000
Retained earnings 122,000 75,000
Total liabilities and equity $ 1,025,000 $ 899,000

  

GOLDEN CORPORATION
Income Statement
For Year Ended December 31, 2018
Sales $ 1,792,000
Cost of goods sold 1,086,000
Gross profit 706,000
Operating expenses
Depreciation expense $ 54,000
Other expenses 494,000 548,000
Income before taxes 158,000
Income taxes expense 22,000
Net income $ 136,000

Problem 12-6A Indirect: Statement of cash flows LO P1, P2, P3

Additional Information on Year 2018 Transactions

  1. Purchased equipment for $36,000 cash.
  2. Issued 12,000 shares of common stock for $5 cash per share.
  3. Declared and paid $89,000 in cash dividends.


Required:
Prepare a complete statement of cash flows; report its cash inflows and cash outflows from operating activities according to the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

Solutions

Expert Solution

Golden Corporation
Statement of Cash Flows
For the year ended December 31, 2018
Cash Flows from Operating Activities $ $
Net Income 136,000
Adjustments to reconcile net income to net cash from operations
Depreciation expense 54,000
Increase in accounts receivable -12,000
Increase in inventory -75,000
Increase in accounts payable 16,000
Increase in income taxes payable 3,000 -14,000
Net cash provided by operations 122,000
Cash Flows from Investing Activities
Cash paid to purchase equipment -36,000
Net cash used in Investing Activities -36,000
Cash Flows from Financing Activities
Cash from issuance of common stock 60,000
Cash paid for dividends -89,000
Net cash used in Financing Activities -29,000
Net increase ( decrease ) in cash 57,000
Cash balance, December 31, 2017 107,000
Cash balance, December 31, 2018 164,000

Related Solutions

Golden Corp., a merchandiser, recently completed its 2018 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2018 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2015 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2015 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2015 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2015 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are...
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT