Question

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

Johnston Enterprises

Balance Sheet and Income Statement Data

                                                                                          December 31,      December 31,

                                                                                              2017                       2016___

Current Assets:

Cash                                                                        $153,000               $119,000

Accounts Receivable                                                 238,000                 306,000

Inventory                                                                    391,000                 340,000

Total Current Assets                                            782,000                 765,000

Property, Plant, and Equipment                                1,241,000              1,122,000

Less: Accumulated Depreciation                                (476,000)               (442,000)

Total Assets                                                             $1,547,000            $1,445,000

Current Liabilities:

Accounts Payable                                                    $187,000               $102,000

Notes Payable                                                             51,000                   68,000

Income Taxes Payable                                              85,000                   76,500

Total Current Liabilities                                                323,000                 246,500

Bonds Payable                                                             340,000                 391,000

Total Liabilities                                                              663,000                 637,500

Stockholders' Equity:

Common Stock                                                       510,000                 467,500

Retained Earnings                                                  374,000                 340,000

Total Stockholders' Equity                                            884,000                 807,500

Total Liabilities & Stockholders' Equity                   $1,547,000            $1,445,000

Sales Revenue                                                          1,615,000            $1,513,000

Less Cost of Goods Sold                                             751,000                 731,000

Gross Profit                                                                   864,000                 782,000

Expenses:

Depreciation Expense                                            153,000                 136,000

Salaries and Wages Expense                                391,000                 357,000

Interest Expense                                                      34,000                   34,000

Loss on Sale of Equipment                                      12,000                            0

Income Before Taxes                                                   274,000                 255,000

Less Income Tax Expense                                         110,000               102,000

Net Income                                                                 $164,000               $153,000

Additional Information:

During the year, Johnston sold equipment with an original cost of $153,000 and accumulated depreciation of $119,000. They purchased new equipment for $272,000.

Hint: Cash flow from the sale of equipment = $22,000. Net increase in cash = $34,000.

Required:

Prepare a statement of cash flows for the year ending December 31, 2017.

Answer 1