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Comparative financial statement data for Carmono Company follow: Assets Cash and cash equivalents Accounts receivable Inventory. Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings This Year Last Year $ 4.50 $ 8.00 38.00 77.50 120.00 213.00 40.80 172.20 $ 292.20 31.00 63.60 102.60 182.00 30.60 151.40 $ 254.00 $ 40.00 73.00 141.00 $ 46.50 94.00 151.70 $ 292.20 $ 254.00 Total liabilities and stockholders' equity For this year, the company reported net income as follows: Sales $ 550.00 Cost of goods sold Gross margin Selling and administrative expenses Net income 330.00 220.00 200.00 $ 20.00 This year Carmono paid a cash dividend but it did not sell any property, plant, and equipment or repurchase any of its own stock Required: 1. Using the indirect method, prepare a statement of cash flows for this year. 2. Compute Carmono's free cash flow for this year.

Comparative financial statement data for Carmono Company follow: Assets Cash and cash equivalents Accounts receivable Inventory. Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings This Year Last Year $ 4.50 $ 8.00 38.00 77.50 120.00 213.00 40.80 172.20 $ 292.20 31.00 63.60 102.60 182.00 30.60 151.40 $ 254.00 $ 40.00 73.00 141.00 $ 46.50 94.00 151.70 $ 292.20 $ 254.00 Total liabilities and stockholders' equity For this year, the company reported net income as follows: Sales $ 550.00 Cost of goods sold Gross margin Selling and administrative expenses Net income 330.00 220.00 200.00 $ 20.00 This year Carmono paid a cash dividend but it did not sell any property, plant, and equipment or repurchase any of its own stock Required: 1. Using the indirect method, prepare a statement of cash flows for this year. 2. Compute Carmono's free cash flow for this year.

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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Comparative financial statement data for Carmono Company follow: Assets Cash and cash equivalents Accounts receivable Inventory. Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings This Year Last Year $ 4.50 $ 8.00 38.00 77.50 120.00 213.00 40.80 172.20 $ 292.20 31.00 63.60 102.60 182.00 30.60 151.40 $ 254.00 $ 40.00 73.00 141.00 $ 46.50 94.00 151.70 $ 292.20 $ 254.00 Total liabilities and stockholders' equity For this year, the company reported net income as follows: Sales $ 550.00 Cost of goods sold Gross margin Selling and administrative expenses Net income 330.00 220.00 200.00 $ 20.00 This year Carmono paid a cash dividend but it did not sell any property, plant, and equipment or repurchase any of its own stock Required: 1. Using the indirect method, prepare a statement of cash flows for this year. 2. Compute Carmono's free cash flow for this year.
Transcribed Image Text:Comparative financial statement data for Carmono Company follow: Assets Cash and cash equivalents Accounts receivable Inventory. Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Total assets Liabilities and Stockholders' Equity Accounts payable Common stock Retained earnings This Year Last Year $ 4.50 $ 8.00 38.00 77.50 120.00 213.00 40.80 172.20 $ 292.20 31.00 63.60 102.60 182.00 30.60 151.40 $ 254.00 $ 40.00 73.00 141.00 $ 46.50 94.00 151.70 $ 292.20 $ 254.00 Total liabilities and stockholders' equity For this year, the company reported net income as follows: Sales $ 550.00 Cost of goods sold Gross margin Selling and administrative expenses Net income 330.00 220.00 200.00 $ 20.00 This year Carmono paid a cash dividend but it did not sell any property, plant, and equipment or repurchase any of its own stock Required: 1. Using the indirect method, prepare a statement of cash flows for this year. 2. Compute Carmono's free cash flow for this year.
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