Question

The comparative balance sheets for 2018 and 2017 and the statement of income for 2018 are given below for Dux Company. Additional information from Dux's accounting records is provided also.

DUX COMPANY Comparative Balance Sheets December 31, 2018 and 2017 ($ in 000s)
	2018				2017
Assets
Cash	$	81			$	56
Accounts receivable		59				60
Less: Allowance for uncollectible accounts		(3	)			(2	)
Dividends receivable		7				6
Inventory		50				45
Long-term investment		32				30
Land		70				35
Buildings and equipment		275				310
Less: Accumulated depreciation		(51	)			(90	)
	$	520			$	450
Liabilities
Accounts payable	$	59			$	73
Salaries payable		3				6
Interest payable		9				4
Income tax payable		8				16
Notes payable		35				0
Bonds payable		95				70
Less: Discount on bonds		(5	)			(6	)
Shareholders' Equity
Common stock		210				200
Paid-in capital—excess of par		24				20
Retained earnings		88				67
Less: Treasury stock (at cost)		(6	)			0
	$	520			$	450

DUX COMPANY Income Statement For the Year Ended December 31, 2018 ($ in 000s)
Revenues
Sales revenue	$	300
Dividend revenue		7		$	307
Expenses
Cost of goods sold		170
Salaries expense		45
Depreciation expense		6
Bad debt expense		1
Interest expense		10
Loss on sale of building		7
Income tax expense		22			261
Net income				$	46

Additional information from the accounting records:

A building that originally cost $60,000, and which was three-fourths depreciated, was sold for $8,000.

The common stock of Byrd Corporation was purchased for $2,000 as a long-term investment.

Property was acquired by issuing a 13%, seven-year, $35,000 note payable to the seller.

New equipment was purchased for $25,000 cash.

On January 1, 2018, bonds were sold at their $25,000 face value.

On January 19, Dux issued a 5% stock dividend (1,000 shares). The market price of the $10 par value common stock was $14 per share at that time.

Cash dividends of $11,000 were paid to shareholders.

On November 12, 500 shares of common stock were repurchased as treasury stock at a cost of $6,000.

Required:
Prepare the statement of cash flows of Dux Company for the year ended December 31, 2018. Present cash flows from operating activities by the direct method. (Do not round your intermediate calculations. Enter your answers in thousands (i.e., 5,000 should be entered as 5). Amounts to be deducted should be indicated with a minus sign.)

Answer 1

Cash from Operating activities			40
Collection from Debtors		301
Dividend Income		6
Paid to Suppliers		-189
Paid for Salaries		-48
Income Tax		-30
Cash from Investing Activities			-60
Sale of Building		8
Purcahse of Common Stock		-2
Purcahse of Equipment		-25
Purcahse of Treasury Stock		-6
Purcahse of Land		-35
Cash from Financing Activities			45
Sale of Bonds		26
Dividend		-11
Issuance of Note payable		35
Interest Paid		-5
Debtor (net of uncollectable)
Opening Balnace		60
Add: Sales		300
Less: Closing Balance		59
Collection		301
Dividend Income
Opening Balnace		6
Add: Divident Income		7
Less: Closing Balance		7
Collection		6
Suppliers
Opening Balance		73
Add: Purchases		175
Less: Closing Balance		59
Amount Paid		189
Purcahses
Closing Balance		50
Add: Cost of goods sold		170
Less: Openning Balance		45
Purchases		175
Salaries
Opening Balance		6
Add: Booked in P&L		45
Less: Closing Balance		3
Amount Paid		48
Income Tax Paid
Opening Balance		16
Add: Provision in PL		22
Less: Closing Balance		8
Amount Paid		30
Interest Paid
Opening Balance		4
Add: Provision in PL		10
Less: Closing Balance		9
Amount Paid		5