Question

The comparative balance sheets of Coronado Inc. at the beginning and the end of the year 2020 are as follows.

CORONADO INC. BALANCE SHEETS
		Dec. 31, 2020				Jan. 1, 2020				Inc./Dec.
Assets
Cash			$ 46,480				$ 14,480			$32,000	Inc.
Accounts receivable			94,200				89,720			4,480	Inc.
Equipment			42,200				23,720			18,480	Inc.
Less: Accumulated Depreciation-Equipment			20,200				11,000			9,200	Inc.
Total			$162,680				$116,920
Liabilities and Stockholders’ Equity
Accounts payable			$ 23,200				$ 16,720			6,480	Inc.
Common stock			101,480				81,720			19,760	Inc.
Retained earnings			38,000				18,480			19,520	Inc.
Total			$162,680				$116,920

Net income of $47,200 was reported, and dividends of $27,680 were paid in 2020. New equipment was purchased and none was sold.

Prepare a statement of cash flows for the year 2020. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Answer 1

Constantine Cavamanlis Inc.
Statement of Cash Flows
For the Year Ended December 31, 2020
Cash flows from operating activities
Net Income		47,200.00
Adjustments to reconcile net income
Net cash provided by operating activities
Depreciation expense	9,200.00
Increase in accounts receivable	-   4,480.00
Increase in accounts payable	6,480.00	11,200.00
Net cash provided by operating activities		58,400.00
Cash flows from investing activities
Purchase of equipment		- 18,480.00
Cash flows from financing activities
Issuance of common stock	19,760.00
Payment of cash dividends	- 27,680.00
Net cash used by financing activities		-   7,920.00
Net increase in cash		32,000.00
Cash at beginning of year		14,480.00
Cash at end of year		46,480.00