Question

A comparative balance sheet for Crane Corporation is presented below.

		December 31
Assets		2020		2019
Cash		$70720		$22880
Accounts receivable		85280		68640
Inventory		176800		196560
Land		73840		114400
Equipment		291200		208000
Accumulated depreciation–equipment		(76960)		(43680)
Total		$620880		$566800
Liabilities and Stockholders’ Equity
Accounts payable		$35360		$48880
Bonds payable		156000		208000
Common stock ($1 par)		170560		170560
Retained earnings		258960		139360
Total		$620880		$566800

Additional information:

1.		Net income for 2020 was $161200; there were no gains or losses.
2.		Cash dividends of $41600 were declared and paid.
3.		Bonds payable of $52000 were retired.

Compute each of the following: (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

1.		Net cash provided by operating activities		$
2.		Net cash provided (used) by investing activities		$
3.		Net cash provided (used) by financing activities		$

Answer 1

Statement of cash flows

Particulars	$	$
Cash flow from Operating Activities
Net income	161,200
Add: Adjustments to reconcile net income to net cash provided by operating activities
Depreciation on equipment	33,280
Changes in current operating assets and liabilities:
Accounts receivable increase	- 16,640
Inventory decrease	19,760
Accounts payable decrease	- 13,520
Net cash provided by Operating Activities		184,080
Cash flow from Investing Activities
Sale of land	40,560
Purchase of equipment	- 83,200
Net cash used in Investing Activities		- 42,640
Cash flow from Financing Activities
Redemption of bonds	- 52,000
Dividend paid	- 41,600
Net cash used in Financing Activities		- 93,600

1.		Net cash provided by operating activities		$184,080
2.		Net cash used by investing activities		- $42,640
3.		Net cash used by financing activities		- $93,600