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Additional data: 1. Depreciation expense was $17,500. 2. Dividends declared and paid were $20,000. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had accumulated depreciation of $9,500 at the time of sale. 3.

Additional data: 1. Depreciation expense was $17,500. 2. Dividends declared and paid were $20,000. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had accumulated depreciation of $9,500 at the time of sale. 3.

FINANCIAL ACCOUNTING
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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Just need help computing the free Cash Flow. A quick response will be appreciated 

Additional data: 1. Depreciation expense was $17,500. 2. Dividends declared and paid were $20,000. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had accumulated depreciation of $9,500 at the time of sale. 3. 4. Bonds were redeemed at their carrying value. 5. Common stock was issued at par for cash.
Transcribed Image Text:Additional data: 1. Depreciation expense was $17,500. 2. Dividends declared and paid were $20,000. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had accumulated depreciation of $9,500 at the time of sale. 3. 4. Bonds were redeemed at their carrying value. 5. Common stock was issued at par for cash.
Warner Company Statement of Cash Flows - Indirect Method For the Year Ended Decamber 21,2022 Cash Flows from Operating Activitles Net income 22000 Adjustments to reconcile net income to Net Caah Provided lby Operaing Activilea Deprecietion Expenae 17500 Increase In Accounta Recelvable -6000 Increase In Accounta Payable 4000 Decrease in Income Taa Payable -1000 Increase in Inventory -8000 6500 Net Caah Provided by Operating Activielea v 38500 Cah Flowa from Inveating Actvtlea Sale of Equlpment Net Cash Provided by Investing Activities Cash Flowa from Financing Activitlea Redemptlon of Bonda -16000 Payment of Dhvidends -20.000 Issuance of Common Stock 4000 Net Cash Used by Financing Activities -32000 Net Incresse in Cash 15000 Cash at Beginning of Perfod 20000 Cash at End of Perlod 35000 eTextbook and Medla Your answer is incorrect. Compute free cash flow. (Show amounts that decrease cash flow with either a- signeg -15,000 or in parenthesis eg. (15,000)) Free cash flaw
Transcribed Image Text:Warner Company Statement of Cash Flows - Indirect Method For the Year Ended Decamber 21,2022 Cash Flows from Operating Activitles Net income 22000 Adjustments to reconcile net income to Net Caah Provided lby Operaing Activilea Deprecietion Expenae 17500 Increase In Accounta Recelvable -6000 Increase In Accounta Payable 4000 Decrease in Income Taa Payable -1000 Increase in Inventory -8000 6500 Net Caah Provided by Operating Activielea v 38500 Cah Flowa from Inveating Actvtlea Sale of Equlpment Net Cash Provided by Investing Activities Cash Flowa from Financing Activitlea Redemptlon of Bonda -16000 Payment of Dhvidends -20.000 Issuance of Common Stock 4000 Net Cash Used by Financing Activities -32000 Net Incresse in Cash 15000 Cash at Beginning of Perfod 20000 Cash at End of Perlod 35000 eTextbook and Medla Your answer is incorrect. Compute free cash flow. (Show amounts that decrease cash flow with either a- signeg -15,000 or in parenthesis eg. (15,000)) Free cash flaw
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