Herman Corporation reported the following transactions for 2019: 1. Sold equipment for $28,000. The original cost...

Herman Corporation reported the following transactions for 2019:

1.	Sold equipment for $28,000. The original cost was $60,000; the book value is $24,000
2.	Issued 2,000 shares of $20 par value common stock for $48 per share
3.	Paid $12,000 for an Insurance policy which goes into effect in January 2020
4.	Recognized $8,000 in Interest expense on Dec 31, 2019 - to be paid on April 30, 2020
5.	Received $32,000 as collections from customers for 2018 sales, and $72,000 for 2019 sales
6.	Reacquired 300 shares of its own common stock at $80 per share
7.	Received $8,000 in dividends on stock held as available for sale
8.	Recorded depreciation expense for $20,000
9.	Paid $4,000 of dividends to common stockholders
10.	Purchased equipment costing $260,000, by making a cash down payment of $80,000 and signing a note for the remaining $180,000.
11.	Acquired a building with a market value of $1,000,000 by issuing 20,000 shares of common stock.
12.	Paid salaries of $72,000
13.	Cash received from sale of available for sale securities $24,000
14.	Repaid a loan, which included $20,000 of the principal and $4,000 in interest

Herman Corporation uses the direct method for preparing the 2019 Statement of Cash Flows.

1. The net cash flow from operating activities is

2. The net cash flow from investing activities is

3. The net cash flow from financing activities is

Expert Solution


	Statement of Cash Flow statement for 2019

	Particulars		Amount in $
1.)	Cash flows from Operating activities
	Cash Collection
	Collection from Customers ( 32,000 + 72,000 )	104,000
	Collection of Dividend Revenue	8,000	112,000
	Less :Cash Payments
	Payments for Insurance Policy in Advance	-12,000
	Payment of Salaries	-72,000
	Payment of Interest	-4,000	-88,000

	Net Cash flow from operating activities		24,000

2.)	Cash flows from investing activities
	Sale of Equipment	28,000
	Sale of available for sale securities	24,000
	Purchase of Equipment by Cash payment	-80,000

	Net Cash flow from (used in ) Investing activities		-28,000

3.)	Cash flows from financing activities
	Proceeds from Issue of Common Stock ( 2,000 x 48 )	96,000
	Repayment of loan principal	-20,000
	Dividend Paid	-4,000
	Reacquired Common Stock ( 300 x 80 )	-24,000

	Net Cash flows from (used in )financing activities		48,000

ekkarill92 answered 2 years ago

Pen Corporation owned equipment with an original cost of $90,000. On January 1, 2019, Pen sold...

Pen Corporation owned equipment with an original cost of $90,000. On January 1, 2019, Pen sold the equipment to Sen Company (a 60%-owned subsidiary) for a price of $82,400. At the time of the intercompany sale, the equipment had been depreciated for $18,400. The equipment has a remaining useful life of 8 years and is straight-line depreciated. On January 1, 2021, Sen sold the equipment to an outside company for $63,200. (i) Prepare the working paper eliminating entry regarding the...

1.Equipment with a book value of $82,000 and an original cost of $161,000 was sold at...

1.Equipment with a book value of $82,000 and an original cost of $161,000 was sold at a loss of $33,000. Paid $100,000 cash for a new truck. Sold land costing $310,000 for $405,000 cash, yielding a gain of $95,000. Long-term investments in stock were sold for $92,100 cash, yielding a gain of $14,000. Use the above information to determine cash flows from investing activities. (Amounts to be deducted should be indicated with a minus sign.) 2. Net income was $467,000....

Equipment with an original cost of $51,422 and accumulated depreciation of $33,306 was sold at a...

Equipment with an original cost of $51,422 and accumulated depreciation of $33,306 was sold at a loss of $5,155. As a result of this transaction, cash would a.increase by $12,961 b.increase by $51,422 c.decrease by $5,155 d.decrease by $33,306

Farmer Company sold a piece of equipment for $6,000. The equipment had an original cost of...

Farmer Company sold a piece of equipment for $6,000. The equipment had an original cost of $34,000 and accumulated depreciation of $31,000 at the time of the sale. Which of the following correctly shows the effect of the sale on the elements of the financial statements? Assets = Liab. + Stk Equity Rev./Gain − Exp. = Net Inc. Stmt of Cash Flow A. 3,000 NA 3,000 3,000 NA 3,000 6,000 OA B. (3,000) NA (3,000) NA 3,000 (3,000) 6,000 IA...

Miley Enterprises sold equipment for $8,000 on March 1, 2019. The equipment had cost $24,000. The...

Miley Enterprises sold equipment for $8,000 on March 1, 2019. The equipment had cost $24,000. The balance in the accumulated depreciation account at December 31, 2019 was $17,000. Depreciation expense per month is $1,000. Prepare the 2 journal entries that Miley would make to record the sale of this equipment. The December 2019 Balance Sheet of Cooper Company showed Equipment of $64,000 and Accumulated Depreciation of $18,000 before depreciation is recorded for 2019. On December 31, 2019, the company decided...

On January 1, 2019, The Rusty Moose Corporation sold a building that cost $300,000 and that...

On January 1, 2019, The Rusty Moose Corporation sold a building that cost $300,000 and that had accumulated depreciation of $115,000 on the date of sale. The Rusty Moose received as consideration a $325,000 non-interest-bearing note due on January 1, 2023. There was no established exchange price for the building, and the note had no ready market. The prevailing rate of interest for a note of this type on January 1, 2019, was 6%. At what amount should the gain...

Firm OCS sold business equipment with a $28,000 initial cost basis and $14,515 accumulated tax depreciation....

Firm OCS sold business equipment with a $28,000 initial cost basis and $14,515 accumulated tax depreciation. In each of the following cases, compute OCS’s recaptured ordinary income and Section 1231 gain or loss on sale. (Losses should be indicated with a minus sign. Leave no cell blank. Enter "0" for cells that do not have an amount.) Required: 1. Amount realized was $11,600. 2.Amount realized was $14,000. 3. Amount realized was $19,100. 4. Amount realized was $32,100.

32. Nabors Finance Company reported equipment with an original cost of $379,000 and $344,000 and accumulated...

32. Nabors Finance Company reported equipment with an original cost of $379,000 and $344,000 and accumulated depreciation of $153,000 and $128,000, respectively in its financial statements for years ended December 31, 2020 and 2019. During 2020, Nabors purchased equipment costing $50,000 and sold equipment with carrying amount of $9,000. What amount should Nabors report as depreciation expense for 2020? a. $19,000 c. $31,000 b. $25,000 d. $34,000

Crushenberry Corporation had the following transactions. 1. Sold land (cost $12,000) for $15,000. 2. Issued common...

Crushenberry Corporation had the following transactions. 1. Sold land (cost $12,000) for $15,000. 2. Issued common stock at par for $20,000. 3. Recorded depreciation on buildings for $17,000. 4. Paid salaries of $9,000. 5. Issued 1,000 shares of $1 par value common stock for equipment worth $8,000. 6. Sold equipment (cost $10,000, accumulated depreciation $7,000) for $1,200. Instructions. For each transaction above, (a) prepare the journal entry

Sheridan Corporation had the following transactions. 1. Sold land (cost $11,300) for $14,300. 2. Issued common...

Sheridan Corporation had the following transactions. 1. Sold land (cost $11,300) for $14,300. 2. Issued common stock at par for $20,000. 3. Recorded depreciation on buildings for $16,300. 4. Paid salaries of $8,300. 5. Issued 1,200 shares of $1 par value common stock for equipment worth $9,600. 6. Sold equipment (cost $9,200, accumulated depreciation $6,440) for $1,104. (a) For each transaction above, prepare the journal entry. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)...

Question