5. The president of Laporte Inc., Tanya Turcotte, was provided with a copy of the operating activities section of the statement of cash flows that you prepared in (1.), and made the following comment: “This report is supposed to show operating cash inflows and outflows during the year, but I don’t see how much cash Laporte Inc. received from customers and how much it paid to trade suppliers and for income taxes. Please ask whoever prepared this statement to provide me with these numbers.” Based on Tanya’s comment, compute the following amounts for 2020: (Enter your answers in millions.)a.Cash collected from customers b.Cash paid to trade suppliers c.Cash paid for income taxes LAPORTE INC.Statement of Cash Flows (Partial)For the Year Ended December 31, 2020Cash flows from operating activities:Net earningsAdd (deduct) items not affecting cash:Decrease in accounts payableDecrease in income tax payableDecrease in merchandise inventoryDepreciation expenseGain on sale of investmentsIncrease in accounts receivableLoss on sale of equipmentNet cash used for operating activities17(14)(1)710(6)(20)2(5) The following information has been reported by Laporte Inc. on its statements of financial position at December 31, 2019 and 2020and on its statement of earnings for the year ended December 31, 2020. Amounts are in millions of dollars:Statements of Financial PositionCashAccounts receivableMerchandise inventoryLong-term investmentsProperty, plant, and equipmentAccumulated depreciationTotal assetsAccounts payableIncome taxes payableLong-term borrowingsContributed capitalRetained earningsTotal liabilities and shareholders' equityStatement of EarningsSalesCost of salesGross profitDepreciation expenseOther operating expensesEarnings from operationsGain on sale of investmentsLoss on sale of equipmentEarnings before income taxIncome tax expenseNet earnings2020$ 1256849|A|A215(57)$ 400$ 48511118056$ 400$ 20038885²°¯**|-|(120)2019$80485642178(72)$ 3326266116043$ 332Additional information is as follows:a. Old equipment was sold for cash during 2020. It had an original cost of $48 and an accumulated depreciation of $25.b. A new building was acquired during the year in exchange for a long-term note for $50, payable in five years. In addition, newequipment was purchased for cash.

a. Cash collected from customers = Beginning Receivables + Sales - Ending Receivables b. Cash paid…

Answered: 5. The president of Laporte Inc., Tanya…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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5. The president of Laporte Inc., Tanya Turcotte, was provided with a copy of the operating activities section of the statement of cash flows that you prepared in (1.), and made the following comment: “This report is supposed to show operating cash inflows and outflows during the year, but I don’t see how much cash Laporte Inc. received from customers and how much it paid to trade suppliers and for income taxes. Please ask whoever prepared this statement to provide me with these numbers.” Based on Tanya’s comment, compute the following amounts for 2020: (Enter your answers in millions.)

a.	Cash collected from customers
b.	Cash paid to trade suppliers
c.	Cash paid for income taxes

LAPORTE INC.
Statement of Cash Flows (Partial)
For the Year Ended December 31, 2020
Cash flows from operating activities:
Net earnings
Add (deduct) items not affecting cash:
Decrease in accounts payable
Decrease in income tax payable
Decrease in merchandise inventory
Depreciation expense
Gain on sale of investments
Increase in accounts receivable
Loss on sale of equipment
Net cash used for operating activities
17
(14)
(1)
7
10
(6)
(20)
2
(5)

The following information has been reported by Laporte Inc. on its statements of financial position at December 31, 2019 and 2020
and on its statement of earnings for the year ended December 31, 2020. Amounts are in millions of dollars:
Statements of Financial Position
Cash
Accounts receivable
Merchandise inventory
Long-term investments
Property, plant, and equipment
Accumulated depreciation
Total assets
Accounts payable
Income taxes payable
Long-term borrowings
Contributed capital
Retained earnings
Total liabilities and shareholders' equity
Statement of Earnings
Sales
Cost of sales
Gross profit
Depreciation expense
Other operating expenses
Earnings from operations
Gain on sale of investments
Loss on sale of equipment
Earnings before income tax
Income tax expense
Net earnings
2020
$ 125
68
49
|A|A
215
(57)
$ 400
$ 48
5
111
180
56
$ 400
$ 200
38885²°¯**|-|
(120)
2019
$80
48
56
42
178
(72)
$ 332
62
6
61
160
43
$ 332
Additional information is as follows:
a. Old equipment was sold for cash during 2020. It had an original cost of $48 and an accumulated depreciation of $25.
b. A new building was acquired during the year in exchange for a long-term note for $50, payable in five years. In addition, new
equipment was purchased for cash.

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