In: Accounting
The comparative belance sheets for Veughn Corporetion show the following information. December 31 2017 2016 Cash $33,700 $12,800 12,200 9,900 12,000 9,100 -0 3,000 Accounts receivable 0- 30,000 11,900 19,800 5,000 6,200 $107,800 $90,800 Buildings Patents Allowance for doubtful $2,900 $4,500 depreclation2,100 cquipment -6,000 5,000 3,000 05,000 3,10 4,000 31,000 25,000 43,000 33,000 20,700 5,B00 $107,800 $90,800 Accounts payable Notes payable, short-term (nontrade) Lang-term notes payable Common stock Retained earnings Additional data related to 2017 are as follows. 1. Equipment that had cost S11, 100 and was 40% depreciated at time of disposel was sold for $2,400. 2. $10,0OD of the long term note payable was paid by issuing common stock. 3. Cash dividends paid were $5,000 4. On January 1, 2017, the building was completely destroyed by a flood. Insurance proceeds on the building were $29,800 (net of $2,100 taxes). 5. Investments (available-for-sale) were sold at $1,700 abavE their cost. The company has made similar sales and investments in the past. 6. Cash was paid for the acquisition of equipment. 7. A long-term nate for $16,000 was issued far the acquisition of equipment B. Interest or 1,900 and income taxes or s6,500 were paid in cash. Prepare statement Of cash flows using the indirect methad.
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VAUGHN CORPORATION | ||
Statement of Cash Flows | ||
For the Year Ended December 31, 2017 | ||
Cash flows from operating activities | ||
Net income | 14,900.00 | |
Loss on sale of equipment (WN.1) | 4,260.00 | |
Gain from flood damage (WN 2) | - 7,900.00 | |
Depreciation expense | 2,040.00 | |
Patent amortization | 1,200.00 | |
Gain on sale of investments | - 1,700.00 | |
Increase in Accts Receivable | - 3,900.00 | |
Increase in inventory | - 2,900.00 | |
Increase in accounts payable | 2,000.00 | - 6,900.00 |
Net cash provided by operating activities | 8,000.00 | |
Cash flows from investing activities | ||
Sale of investments | 4,700.00 | |
Sale of equipment | 2,400.00 | |
Proceeds from flood damage to building | 31,900.00 | |
Purchase of equipment | - 20,200.00 | |
Net cash provided by investing activities | 18,800.00 | |
Cash flows from financing activities | ||
Payment of dividends | - 5,000.00 | |
Payment of short-term note payable | - 900.00 | |
Net cash used by financing activities | - 5,900.00 | |
Increase in cash | 20,900.00 | |
Cash, January 1, 2017 | 12,800.00 | |
Cash, December 31, 2017 | 33,700.00 |
Supplemental disclosures of cash flow information: | |
Cash paid during the year for: | |
Interest | 1,900.00 |
Income taxes | 6,500.00 |
Noncash investing and financing activities | |
Retired note payable by issuing common stock | 10,000.00 |
Purchased equipment by issuing note payable | 16,000.00 |
26,000.00 |
Working Note-1 | |
Equipment Cost | 11,100.00 |
Equipment cost after depreciation | 6,660.00 |
Sales Price | 2,400.00 |
Loss on Sale | 4,260.00 |
Working Note-2 | |
Insurance Proceeds | 29,800.00 |
Tax | 2,100.00 |
Building cost | - 30,000.00 |
Accumulated Depreciation | 6,000.00 |
Gain from flood damage | 7,900.00 |