Question

Golden Corp.'s current year income statement, comparative balance sheets, and additional information follow. 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. Purchased equipment for $36,000 cash. Issued 12,000 shares of common stock for $5 cash per share. Declared and paid $89,000 in cash dividends.

Answer 1

GOLDEN CORPORATION
Statement of Cash Flows
For the Ended December 31, 2017
Cash flows from operating activities:
Net Income	136,000
Adjustment to reconcile net income to net cash provided by operations
Accounts receivable increase	(12,000)
Inventory increase	(75,000)
Accounts payable increase	16,000
Income taxes payable increase	3,000
Depreciation expense	54,000
Net cash provided by operating activities		122,000
Cash flows from investing activities:
Cash paid for equipment	(36,000)
Net cash used in investing activities		(36,000)
Cash flows from financing activities:
Cash received from stock issuance	60,000
Cash paid for cash dividends	(89,000)
Net cash used in financing activities		(29,000)
Net increase (decrease) in cash		57,000
Cash balance at beginning of year		107,000
Cash balance at end of year		164,000