In: Accounting
Current Attempt in Progress Crane Company reported the following information for 2022. Crane Company Comparative Balance Sheets December 31 Assets 2022 2021 Change Increase/Decrease Cash $35,400 $21,600 $13,800 Increase Accounts receivable 37,200 13,200 24,000 Increase Inventory 26,400 –0– 26,400 Increase Prepaid expenses 3,600 2,400 1,200 Increase Land 33,000 42,000 9,000 Decrease Buildings 120,000 120,000 –0– Accumulated depreciation—buildings (12,600 ) (8,400 ) 4,200 Increase Equipment 109,800 40,800 69,000 Increase Accumulated depreciation—equipment (16,800 ) (6,000 ) 10,800 Increase Totals $336,000 $225,600 Liabilities and Stockholders’ Equity Accounts payable $25,800 $24,000 $1,800 Increase Accrued expenses payable 0 6,000 6,000 Decrease Bonds payable 60,000 90,000 30,000 Decrease Common stock ($1 par) 138,000 36,000 102,000 Increase Retained earnings 112,200 69,600 42,600 Increase Totals $336,000 $225,600 Crane Company Income Statement For the Year Ended December 31, 2022 Sales revenue $564,600 Cost of goods sold $285,000 Operating expenses 138,600 Interest expense 7,200 Loss on disposal of equipment 1,200 432,000 Income before income taxes 132,600 Income tax expense 39,000 Net income $93,600 Additional information: 1. Operating expenses include depreciation expense of $24,000. 2. Land was sold at its book value for cash. 3. Cash dividends of $51,000 were declared and paid in 2022. 4. Equipment with a cost of $99,600 was purchased for cash. Equipment with a cost of $30,600 and a book value of $21,600 was sold for $20,400 cash. 5. Bonds of $30,000 were redeemed at their face value for cash. 6. Common stock ($1 par) of $102,000 was issued for cash. Use this information to prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Statement of Cash Flows | ||
For the Year Ended December 31, 2022 | ||
Cash Flows from Operating Activities: | ||
Net income | 93600 | |
Adjustments to reconcile net income to | ||
Net cash provided by operating activities | ||
Depreciation expense | 24000 | |
Loss on disposal of equipment | 1200 | |
Increase in Accounts receivable | -24000 | |
Increase in inventory | -26400 | |
Increase in Prepaid expenses | -1200 | |
Increase in accounts payable | 1800 | |
Decrease in accrued expenses payable | -6000 | |
-30600 | ||
Net cash provided by operating activities | 63000 | |
Cash Flows from Investing Activities: | ||
Sale of Equipment | 20400 | |
Purchase of Equipment | -99600 | |
Sale of Land | 9000 | |
Net Cash used by Investing Activities | -70200 | |
Cash Flows from Financing Activities | ||
Payment of Cash Dividends | -51000 | |
Redemption of Bonds Payable | -30000 | |
Issuance of Common Stock | 102000 | |
Net Cash provided by Financing Activities | 21000 | |
Net Increase in Cash | 13800 | |
Cash at Beginning of Period | 21600 | |
Cash at End of Period | 35400 |