In: Accounting
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.
GOLDEN CORPORATION Comparative Balance Sheets December 31 |
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Current Year | Prior Year | ||||||||||
Assets | |||||||||||
Cash | $ | 177,000 | $ | 121,300 | |||||||
Accounts receivable | 102,500 | 84,000 | |||||||||
Inventory | 620,500 | 539,000 | |||||||||
Total current assets | 900,000 | 744,300 | |||||||||
Equipment | 370,000 | 312,000 | |||||||||
Accum. depreciation—Equipment | (164,500 | ) | (110,500 | ) | |||||||
Total assets | $ | 1,105,500 | $ | 945,800 | |||||||
Liabilities and Equity | |||||||||||
Accounts payable | $ | 113,000 | $ | 84,000 | |||||||
Income taxes payable | 41,000 | 31,600 | |||||||||
Total current liabilities | 154,000 | 115,600 | |||||||||
Equity | |||||||||||
Common stock, $2 par value | 607,600 | 581,000 | |||||||||
Paid-in capital in excess of par value, common stock | 219,400 | 179,500 | |||||||||
Retained earnings | 124,500 | 69,700 | |||||||||
Total liabilities and equity | $ | 1,105,500 | $ | 945,800 | |||||||
GOLDEN CORPORATION Income Statement For Current Year Ended December 31 |
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Sales | $ | 1,857,000 | ||||
Cost of goods sold | 1,099,000 | |||||
Gross profit | 758,000 | |||||
Operating expenses | ||||||
Depreciation expense | $ | 54,000 | ||||
Other expenses | 507,000 | 561,000 | ||||
Income before taxes | 197,000 | |||||
Income taxes expense | 40,200 | |||||
Net income | $ | 156,800 | ||||
Additional Information on Current Year Transactions
|
Answer-
GOLDEN CORPORATION | ||
STATEMENT OF CASH FLOWS (USING INDIRECT METHOD) | ||
FOR THE YEAR ENDED 31 | ||
Particulars | Amount | |
$ | ||
Cash flow from operating activities | ||
Net Income | 156800 | |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Adjustment for non cash effects | ||
Depreciation expenses | 54000 | |
Change in operating assets & liabilities | ||
Increase in accounts receivable | -18500 | |
Increase in inventory | -81500 | |
Increase in accounts payable | 29000 | |
Increase in income taxes payable | 9400 | |
Net cash flow from operating activities (a) | 149200 | |
Cash Flow from Investing activities | ||
New equipment purchased | -58000 | |
Net cash Flow from Investing activities (b) | -58000 | |
Cash Flow from Financing activities | ||
Cash dividends paid | -102000 | |
Common stock issued | 66500 | |
Net cash Flow from Financing activities (c) | -35500 | |
Net Change in cash c=a+b+c | 55700 | |
Beginning cash balance | 121300 | |
Closing cash balance | 177000 |