The following are the balance sheet and income statement of Fleming Instructional Repair Engineers
Year 1
Year 2
Inventories
7,120
7,950
Property, Plant & Equipment (net of depreciation)
14,175
14,820
Accounts Payable
5,672
5,243
Retained Earnings
32,184
38,945
Sales
107,265
Cost of Goods Sold
(84,326)
Depreciation Expense
(1,049)
SG&A
(6,829)
Taxes
(5,347)
Net Income
9,714
1. Compute the cash paid for inventories during fiscal year 2.
You may assume that accounts payable
2. Compute the cost of PPE acquired during the year given FIRE sold $565 of PPE at book value.
3. Compute the amount of dividends paid in fiscal year 2.
1. Cash paid for inventories = Begin Inventory + Purchases - Cost of goods sold
Cost of Goods Sold
84,326
Inventory (7,950 - 7,120)
830
Accounts Payable (5672 - 5243)
429
Cash paid for inventories
85,585
2. Cost of PPE
PPE (14,820 - 14,175)
645
Book Value of PPE
565
Depreciation
1,049
Cash for PPE
2,259
3. Amount of dividends
Beginning retained earnings
32,184
Net income
9,714
Ending retained earnings
(38,945)
