In: Accounting
A comparative balance sheet and income statement is shown for Cruz, Inc.
CRUZ, INC. Comparative Balance Sheets December 31, 2017 |
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2017 | 2016 | ||||||
Assets | |||||||
Cash | $ | 99,000 | $ | 25,000 | |||
Accounts receivable, net | 42,800 | 53,100 | |||||
Inventory | 89,600 | 99,700 | |||||
Prepaid expenses | 5,600 | 4,400 | |||||
Total current assets | 237,000 | 182,200 | |||||
Furniture | 113,000 | 124,700 | |||||
Accum. depreciation—Furniture | (17,600 | ) | (9,400 | ) | |||
Total assets | $ | 332,400 | $ | 297,500 | |||
Liabilities and Equity | |||||||
Accounts payable | $ | 15,600 | $ | 21,900 | |||
Wages payable | 9,400 | 5,200 | |||||
Income taxes payable | 1,500 | 2,700 | |||||
Total current liabilities | 26,500 | 29,800 | |||||
Notes payable (long-term) | 31,100 | 65,700 | |||||
Total liabilities | 57,600 | 95,500 | |||||
Equity | |||||||
Common stock, $5 par value | 238,600 | 190,000 | |||||
Retained earnings | 36,200 | 12,000 | |||||
Total liabilities and equity | $ | 332,400 | $ | 297,500 | |||
CRUZ, INC.
Income Statement
For Year Ended December 31, 2017
Sales $509,400
Cost of goods sold 327,800
Gross profit 181,600
Operating expenses
Depreciation expense$39,200
Other expenses 92,900 132,100
Income before taxes 49,500
Income taxes expense 18,100
Net income $31,400
Required:
Use the indirect method to prepare the cash provided or used from operating activities section only of the statement of cash flows for this company. (Amounts to be deducted should be indicated with a minus sign.)
QS 12-12 Computing cash from asset sales LO P3
Furniture costing $57,700 is sold at its book value in 2017. Acquisitions of furniture total $46,000 cash, on which no depreciation is necessary because it is acquired at year-end. What is the cash inflow related to the sale of furniture?
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QS 12-12 Computing cash from asset sales LO P3
Furniture costing $57,700 is sold at its book value in 2017. Acquisitions of furniture total $46,000 cash, on which no depreciation is necessary because it is acquired at year-end. What is the cash inflow related to the sale of furniture?
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Cash Flow From Operating Activities- Cruz Inc. | ||
Cash Flows From Operating Activities | ||
Net Income | $31,400 | |
Adjustments To Reconcile Net Income To Net Cash Provided By Operations: | ||
Depreciation Expense | 39,200 | |
Decrease in Accounts Receivable | 10,300 | |
Deccrease in Inventory | 10,100 | |
Increase in Prepaid Expense | 1200 | |
Decrease in Accounts Payable | -6,300 | |
Increase in Wages Payable | 4,200 | |
Decrease in Income Tax Payable | -1200 | |
Net Cash Provided By Operating Activities | $88,900 |
Furniture | |
Beg. bal. | $124,700.00 |
Acqusition of Asset | $46,000.00 |
Asset Sold | -$57,700.00 |
End. bal. | $113,000.00 |
Accumulated Depreciation | |
Beg. bal. | $9,400.00 |
Add: Depreciation Expense | $39,200.00 |
Depreciaiton Expense for Asset Sold (9400+39200-17600) | $31,000.00 |
End. bal. | $17,600.00 |
Book Value of Furniture Sold= Cost of Furniture - Accumulated Depreciaiton |
=57700-31000= $26700 |
Hence, Cash Inflow from Sales of Furniture will be : $26700 |