Asset and Contra-Asset Accounts Liabilities and Stockholders' Equity Accounts Cash and cash equivalents $5 D Accounts payable $35 1 Accounts receivable $1101 Accrued liabilities $4 D Inventory $70 D Income taxes payable $8 1 Prepaid expenses $91 Bonds payable $150 1 Long-term investments $6 D Common stock $80 D Property, plant, and equipment $185 I Retained earnings $54 1 Accumulated depreciation $60 1 D- Dere-ee Long term investments that cost the company $6 were sold during the year for $16 and land that cost $15 was sold for $9. In addition, the company declared and paid $30 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place during the yeat. Pavolik did not retire any bonds during the year or issue any new common stock. The company's income statement for the year follows: Page 721 Sales $700 Cost of goods sold 400 Gross margin 300 Selling and administrative expenses 184 Net operating income 16 Nonoperating items Loss on sale of land $(6) Gain on sale of investments 10 Income before taxes 120 Income taxes Net income $ 84 The company's beginning cash balance was $90 and its ending balance was S85. Required: 1. Use the indirect method to determine the net cash provided by operating activities for the year. 2. Prepare a statement of cash lows for the year
Asset and Contra-Asset Accounts Liabilities and Stockholders' Equity Accounts Cash and cash equivalents $5 D Accounts payable $35 1 Accounts receivable $1101 Accrued liabilities $4 D Inventory $70 D Income taxes payable $8 1 Prepaid expenses $91 Bonds payable $150 1 Long-term investments $6 D Common stock $80 D Property, plant, and equipment $185 I Retained earnings $54 1 Accumulated depreciation $60 1 D- Dere-ee Long term investments that cost the company $6 were sold during the year for $16 and land that cost $15 was sold for $9. In addition, the company declared and paid $30 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place during the yeat. Pavolik did not retire any bonds during the year or issue any new common stock. The company's income statement for the year follows: Page 721 Sales $700 Cost of goods sold 400 Gross margin 300 Selling and administrative expenses 184 Net operating income 16 Nonoperating items Loss on sale of land $(6) Gain on sale of investments 10 Income before taxes 120 Income taxes Net income $ 84 The company's beginning cash balance was $90 and its ending balance was S85. Required: 1. Use the indirect method to determine the net cash provided by operating activities for the year. 2. Prepare a statement of cash lows for the year
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Asset and Contra-Asset Accounts
Liabilities and Stockholders' Equity Accounts
Cash and cash equivalents
$5 D Accounts payable
$351
Accounts receivable
$1101 Accrued liabilities
$4 D
Inventory
$70 D Income taxes payable
$8 1
Prepaid expenses
$91 Bonds payable
$150 1
Long term investments
$6 D Common stock
$80 D
Property, plant, and equipment $185 I Retained earnings
$54 1
Accumulated depreciation
$60 1
D-Decre -lncae
Long term investments that cost the company $6 were sold during the year for $16 and land that cost $15 was sold for $9. In addition, the
company declared and paid $30 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and
equipment took place during the year. Pavolik did not retire any bonds during the year or issue any new common stock.
The company's income statement for the year follows:
Page 721
Sales
$700
Cost of goods sold
400
Gross margin
300
Selling and administrative expenses
184
Net operating income
116
Nonoperating items:
Loss on sale of land
$(6)
Gain on sale of investments
10
Income before taxes
120
Income taxes
16
Net income
$ 84
The company's beginning cash balance was $90 and its ending balance was $85.
Required:
1. Use the indireet method to determine the net cash provided by operating activities for the year
2. Prepare a statement of cash Bows for the year.
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