1. Prepare the statement of cash flows. Use the minus sign to indicate cash outflows, a decrease in cash or cash payments.
1. Prepare the statement of cash flows. Use the minus sign to indicate cash outflows, a decrease in cash or cash payments.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Statement of
The following is a list of the items to be included in the preparation of Warrick Company's 2019 statement of cash flows:
- Net income, $35,400
- Payment for purchase of building, $87,000
- Increase in
accounts receivable , $7,200 - Proceeds from issuance of common stock, $36,400
- Increase in accounts payable, $4,400
- Proceeds from sale of land, $8,000
Depreciation expense, $19,000- Payment of dividends, $32,000
- Gain on sale of land, $3,500
- Decrease in inventory, $3,300
- Payment for purchase of long-term investments, $8,300
- Amortization of discount on bonds payable, $1,500
- Proceeds from issuance of note, $16,000
- Increase in
deferred taxes payable, $5,800 - Equipment acquired by capital lease, $19,500
- Decrease in salaries payable, $2,600
- Beginning cash balance, $22,000
Required
1. Prepare the statement of cash flows. Use the minus sign to indicate
WARRICK COMPANY | ||
Statement of Cash Flows | ||
For Year Ended December 31, 2019 | ||
Operating Activities: | ||
Net income | $ | |
Adjustment for noncash income items: | ||
Add: Depreciation expense | ||
Add: Amortization of discount on bonds payable | ||
Add: |
||
Less: Gain on sale of land | ||
Adjustments for cash flow effects from |
||
Increase in accounts receivable | ||
Decrease in inventory | ||
Increase in accounts payable | ||
Decrease in salaries payable | ||
Net cash provided by operating activities | $ | |
Investing Activities: | ||
Payment for purchase of building | $ | |
Proceeds from sale of land | ||
Payment for purchase of long-term investments | ||
Net cash used for investing activities | ||
Financing Activities: | ||
Proceeds from issuance of common stock | $ | |
Proceeds from issuance of note | ||
Payment of dividends | ||
Net cash provided by financing activities | ||
Cash, December 31, 2019 | $ | |
Cash, January 1, 2019 | ||
Cash, December 31, 2019 | $ | |
Investing and Financing Activities Not Affecting Cash | ||
Investing Activities: | ||
Acquisition of equipment under capital lease | $ | |
Financing Activities: | ||
Incurrence of capital lease obligation for equipment |
2. Assume the company's
shares
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