Question

5. The comparative balance sheet for 2018 and 2017 for Samuel Corporation as well as additional     

           information concerning transactions and events during 2018 are presented below:      

Samuel Corporation

Balance Sheet

December 31, 2018 and 2017

                                                                                                              

                                                                                                                   2018                   2017  

         Cash                                                                                              $ 35,900            $ 10,200

         Accounts receivable (net)                                                                 48,300                20,300

         Inventory                                                                                          35,000                42,000

         Long-term investments                                                                              0                15,000

         Property, plant & equipment                                                           236,500              150,000

         Accumulated depreciation                                                               (37,700)              (25,000)

                                                                                                               $318,000            $212,500

         Accounts payable                                                                          $ 19,000            $ 26,500

         Accrued liabilities                                                                             19,000                17,000

         Long-term notes payable                                                                  70,000                50,000

         Common stock                                                                                130,000                90,000

         Retained earnings                                                                             80,000                29,000

                                                                                                               $318,000            $212,500

        Additional data:

        (a) Net income for the year 2018, $90,000.

        (b) Depreciation on plant assets for the year, $12,700.

        (c) Sold the long-term investments for $33,000.

      (d) Paid dividends of $39,000.

        (e) Purchased machinery costing $26,500, paid cash.

        (f) Purchased machinery and gave a $60,000 long-term note payable.

      (g) Paid a $40,000 long-term note payable by issuing common stock.

        Required:

        Using the indirect method, prepare a statement of cash flows for 2018 for Samuel Corporation.

Answer 1