Question

Selected financial statement information and additional data for Johnston Enterprises is presented below:

Johnston Enterprises Balance Sheet and Income Statement Data
		December 31, 2017			December 31, 2016
Current Assets:
Cash		$153,260			$117,200
Accounts Receivable		236,100			306,600
Inventory		397,700			343,800
Total Current Assets		787,060			767,600
Property, Plant, and Equipment		1,271,200			1,136,000
Less: Accumulated Depreciation		(453,900)			(420,900)
Total Assets		1,604,360			1,482,700
Current Liabilities:
Accounts Payable		$189,800			$100,100
Notes Payable		50,100			66,500
Income Taxes Payable		84,700			75,100
Total Current Liabilities		324,600			241,700
Bonds Payable		350,000			390,200
Total Liabilities		674,600			631,900
Stockholders' Equity:
Common Stock		510,000			467,500
Retained Earnings		419,760			383,300
Total Stockholders' Equity		929,760			850,800
Total Liabilities & Stockholders' Equity		1,604,360			1,482,700
Sales Revenue		$1,624,000			$1,516,000
Less Cost of Goods Sold		779,900			730,900
Gross Profit		844,100			785,100
Expenses:
Depreciation Expense		153,200			135,700
Salaries and Wages Expense		389,700			354,900
Interest Expense		32,200			32,200
Loss on Sale of Equipment		11,900			0
Income Before Taxes		257,100			262,300
Less Income Tax Expense		102,840			104,920
Net Income		154,260			157,380

Additional Information:
During the year, Johnston sold equipment with an original cost of $133,800 and accumulated depreciation of $120,200 and purchased new equipment for $269,000.

Prepare a statement of cash flows for the year ending December 31, 2017. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Answer 1

1

Johnston Enterprises
Statement of Cash Flows
For the Year Ended December 31, 2012
Net Income		154260
Cash flow from operating activities
Depreciation expense (33000+120200)	153200
Loss on sale of equipment	11900
Decrease in accounts receivable	70500
Increase in inventory	-53900
Increase in accounts payable	89700
Decrease in notes payable	-16400
Increase in tax payable	9600
		264600
Net cash provided by operating activities		418860
Cash flow from investing activities
Sale of equipment	1700
Purchase of equipment	-269000
Net cash used by investing activities		-267300
Cash flow from financing activities
Retirement of bonds payable	-40200
Issuance of common stock	42500
Payment of dividends	-117800
Net cash used by financing activities		-115500
Net increase in cash		36060
Beginning cash		117200
Cash at end of year		153260

Working notes for the above answer