Question

Given is the Income Statement for the year ended December 31, 20XX, Statement of Retained Earnings for the year ended December 31, 20XX and Comparative Balance Sheets for 20XW and 20XX of Maris Corporation:

Maris Corporation Income Statement Year Ended December 31, 20XX
Sales	$5,400,000
Cost of goods sold	3,650,000
Gross profits	1,750,000
Selling and administrative expense	700,000
Amortization expense	220,000
Operating income	830,000
Interest expense	59,000
Earnings before taxes	771,000
Taxes	460,000
Earnings after taxes	311,000
Preferred stock dividends	25,000
Earnings available to common shareholders	$286,000
Shares outstanding	143,000
Earnings per share	$2.00

  

Statement of Retained Earnings For the Year Ended December 31, 20XX
Retained earnings, balance, January 1, 20XX	$900,000
Add: Earnings available to common shareholders, 20XX	286,000
Deduct: Cash dividends declared and paid in 20XX	150,000
Retained earnings, balance, December 31, 20XX	$1,036,000

  

Comparative Balance Sheets For 20XX and 20XW
	December 31, 20XX			December 31, 20XW
Assets
Current assets:
Cash		$120,000			$108,000
Accounts receivable (net)		510,000			498,000
Inventory		640,000			615,000
Prepaid expenses		23,000			46,000
Total current assets		1,293,000			1,267,000
Investments (long-term securities)		120,000			125,000
Plant and equipment	2,600,000			2,000,000
Less: Accumulated depreciation	984,000			764,000
Net plant and equipment		1,616,000			1,236,000
Total assets		$3,029,000			$2,628,000
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable		$643,000			$440,000
Notes payable		500,000			500,000
Accrued expenses		50,000			68,000
Total current liabilities		1,193,000			1,008,000
Long-term liabilities:
Bonds payable, 20XY		180,000			100,000
Total liabilities		1,373,000			1,108,000
Shareholders’ equity:
Preferred stock		120,000			120,000
Common stock		500,000			500,000
Retained earnings		1,036,000			900,000
Total shareholders’ equity		1,656,000			1,520,000
Total liabilities and shareholders’ equity		$3,029,000			$2,628,000

  

Prepare a statement of cash flows for the Maris Corporation. (Amounts to be deducted should be indicated with a minus sign. Omit $ sign in your response.)

  

Answer 1

Statement of Cash Flow for Marris Corporation Limited
Cash Flow From Operating Activities
	Earning Before Taxes	771000
	Add: Non Cash Expenses
	Depreciation	220000
	Cash Operating Profit	991000
	Less Taxes	-460000
	Net Operating Profit Before Working Capital changes	531000
	Less : Current Assets Increases
	Account Receiable	-12000
	Inventory	-25000
	Add : Current Assets Decreases
	Prepaid Expenses	23000
	Less : Current Liabilities Decreases
	Accrued Expenses	-18000
	Add : Current Liabilities Increases
	Account Payable	203000
	Net Cash Inflow from Operating Activities		702000
Cash Flow From Investing Activities
	Plant and Enquipment Purchased	-600000
	Long Term Securities Sold	5000
	Net Cash Outflow from Investing Activities		-595000
Cash Flow From Financing Activities
	Preference Stock Dividend	-25000
	Cash Dividend for Common Stock	-150000
	Bond issued	80000
	Net Cash Outflow from Financing Activities		-95000
Net Cash Inflow and Outflow		12000
Opening Cash and Cash Equivilants		108000
Closing Cash and Cash Equivilants		120000