orepare a statement of cash flows. Use the indirect method of reporting cash flows from operating activities. In addition to the balance sh lata, assume that: Equipment costing $125,000 was purchased for cash. Equipment costing $85,000 with accumulated depreciation of $65,000 was sold for $15,000. The stock was issued for cash. The only entries in the retained earnings account were net income of $51,000 and cash dividends declared of $13,000. Year 2 Year 1 Assets Cash $100,000 $78,000 Accounts receivable (net) 78,000 85,000 Inventories 101,500 90,000 Equipment 410,000 370,000 Accumulated depreciation (150,000) (158,000) Total assets $539,500 $465,000 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $58,500 $55,000 Cash dividends payable 5,000 4,000 Common stock, $10 par 200,000 170,000 Paid-in capital in excess of par-common stock 62,000 60,000 Retained earnings 214,000 176,000 Total liabilities and stockholders' equity $539,500 $465,000 Jse the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
orepare a statement of cash flows. Use the indirect method of reporting cash flows from operating activities. In addition to the balance sh lata, assume that: Equipment costing $125,000 was purchased for cash. Equipment costing $85,000 with accumulated depreciation of $65,000 was sold for $15,000. The stock was issued for cash. The only entries in the retained earnings account were net income of $51,000 and cash dividends declared of $13,000. Year 2 Year 1 Assets Cash $100,000 $78,000 Accounts receivable (net) 78,000 85,000 Inventories 101,500 90,000 Equipment 410,000 370,000 Accumulated depreciation (150,000) (158,000) Total assets $539,500 $465,000 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $58,500 $55,000 Cash dividends payable 5,000 4,000 Common stock, $10 par 200,000 170,000 Paid-in capital in excess of par-common stock 62,000 60,000 Retained earnings 214,000 176,000 Total liabilities and stockholders' equity $539,500 $465,000 Jse the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On the basis of the following data for Larson Co. for the year ending December 31 Year 2, and the preceding year ended December 31 Year 1,
prepare a statement of cash flows. Use the indirect method of reporting cash flows from operating activities. In addition to the balance sheet
data, assume that:
Equipment costing $125,000 was purchased for cash.
Equipment costing $85,000 with accumulated depreciation of $65,000 was sold for $15,000.
The stock was issued for cash.
The only entries in the retained earnings account were net income of $51,000 and cash dividends declared of $13,000.
Year 2
Year 1
Assets
Cash
$100,000
$78,000
Accounts receivable (net)
78,000
85,000
Inventories
101,500
90,000
Equipment
410,000
370,000
Accumulated depreciation
(150,000)
(158,000)
Total assets
$539,500
$465,000
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)
$58,500
$55,000
Cash dividends payable
5,000
4,000
Common stock, $10 par
200,000
170,000
Paid-in capital in excess of par-common stock
62,000
60,000
Retained earnings
214,000
176,000
Total liabilities and stockholders' equity
$539,500
$465,000
Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
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