Question

In: Accounting

Comparative balance sheets for International Company are presented below.

Comparative balance sheets for International Company are presented below.

INTERNATIONAL COMPANY Comparative Balance Sheets December 31 Assets 2017 2016 $ 73,000 $ 22,000 76,000 189,000 100,000 200,000 (42,000) Cash Accounts receivable Inventory Land 85,000 180,000 75,000 Equipment Accumulated depreciation-equipment 250,000 (66,000) Total $597,000 $545,000 Liabilities and Stockholders' Equity $ 34,000 $ 47,000 Accounts payable Bonds payable Common stock ($1

 

Additional information:

1. Net income for 2017 was $135,000.

2. Cash dividends of $70,000 were declared and paid.

3. Bonds payable amounting to $50,000 were redeemed for cash $50,000.

4. Common stock was issued for $50,000 cash.

5. Depreciation expense was $24,000.

6. Sales revenue for the year was $978,000.

7. Land was sold at cost, and equipment was purchased for cash.

 

Instructions

Prepare a worksheet for a statement of cash flows for 2017 using the indirect method. Enter the reconciling items directly on the worksheet, using letters to cross-reference each entry.

Solutions

Expert Solution

CASH FLOW STATEMENT 2017

Cash flow from Operating Activities    
Net Income 135000  
Depreciation 24000  
Inc in AR -9000  
Dec in Inventory 9000  
Dec in AP -13000 146000
     
Cash flow from Investing Activities    
Sale of land 25000  
Purchase of Equipment -50000 -25000
     
     
Cash flow from Financing Activities    
Issue of Common Stock 50000  
Dividend paid -70000  
Bonds Redeemed -50000 -70000
     
Total Cash Flows   51000
Cash Opening   22000
Closing Cash Flow   73000

CASH FLOW STATEMENT 2017

Cash flow from Operating Activities    
Net Income 135000  
Depreciation 24000  
Inc in AR -9000  
Dec in Inventory 9000  
Dec in AP -13000 146000
 

Junaid answered 2 years ago
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