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Prepare a statement of cash Jlows indirect method, and compute free cash flow P14.7 (LO 2, 3) Presented below are the financial statements of Rajesh Ltd. Rajesh Ltd. Comparative Statements of Financial Position December 31 Assets 2020 2019 £ 60,000 (29,000) £ 78,000 (24.000) Equipment Accumulated depreciation-cquipment Inventory Accounts receivable 30,000 20,000 33,000 14.000 Cash 37,000 20.000 Total £131,000 £108.000 14-46 CHAPTER 14 Statement of Cash Flows Equity and Liabilities Share capital-ordinary Retained carnings Bonds payable £ 18,000 £14,000 50,000 38,000 27,000 33,000

Prepare a statement of cash Jlows indirect method, and compute free cash flow P14.7 (LO 2, 3) Presented below are the financial statements of Rajesh Ltd. Rajesh Ltd. Comparative Statements of Financial Position December 31 Assets 2020 2019 £ 60,000 (29,000) £ 78,000 (24.000) Equipment Accumulated depreciation-cquipment Inventory Accounts receivable 30,000 20,000 33,000 14.000 Cash 37,000 20.000 Total £131,000 £108.000 14-46 CHAPTER 14 Statement of Cash Flows Equity and Liabilities Share capital-ordinary Retained carnings Bonds payable £ 18,000 £14,000 50,000 38,000 27,000 33,000

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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P14.7

Prepare a statement of cash flows- indirect method, and compute free cash flow. P14.7 (LO 2, 3) Presented below are the financial statements of Rajesh Ltd. Rajesh Ltd. Comparative Statements of Financial Position December 31 Assets 2020 2019 £ 78,000 (24.000) £ 60.000 Equipment Accumulated depreciation-cquipment Inventory Accounts receivable (29,000) 30,000 20.000 33,000 14,000 Cash 37,000 20,000 Total £131,000 £108.000 14-46 CHAPTER 14 Statement of Cash Flows Equity and Liabilities Share capital-ordinary Retained carnings Bonds payable £ 18,000 £ 14,000 50,000 38.000 27,000 33,000
Transcribed Image Text:Prepare a statement of cash flows- indirect method, and compute free cash flow. P14.7 (LO 2, 3) Presented below are the financial statements of Rajesh Ltd. Rajesh Ltd. Comparative Statements of Financial Position December 31 Assets 2020 2019 £ 78,000 (24.000) £ 60.000 Equipment Accumulated depreciation-cquipment Inventory Accounts receivable (29,000) 30,000 20.000 33,000 14,000 Cash 37,000 20,000 Total £131,000 £108.000 14-46 CHAPTER 14 Statement of Cash Flows Equity and Liabilities Share capital-ordinary Retained carnings Bonds payable £ 18,000 £ 14,000 50,000 38.000 27,000 33,000
Accounts payable Income taxes payable 29.000 7,000 15,000 8,000 Total £131,000 £108,000 Rajesh Ltd. Income Statement For the Year Ended December 31, 2020 £242,000 175,000 Sales revenuč Cost of goods sold Gross profit Operating expenses 67,000 24,000 Income from operations Interest expense 43,000 3,000 Income before income taxes Income tax expense 40,000 8,000 Net income £ 32,000 Additional data: 1. Depreciation expense is £13,300. 2. Dividends declared and paid were £20,.000. 3. During the ycar, equipment was sold for £9,700 cash. This cquipmcnt cost £18,000 originally and had accumulated depreciation of £8,300 at the time of sale. Instructions a. Cash from operations £29,300 a. Prepare a statement of cash flows using the indirect method. b. Compute free cash flow.
Transcribed Image Text:Accounts payable Income taxes payable 29.000 7,000 15,000 8,000 Total £131,000 £108,000 Rajesh Ltd. Income Statement For the Year Ended December 31, 2020 £242,000 175,000 Sales revenuč Cost of goods sold Gross profit Operating expenses 67,000 24,000 Income from operations Interest expense 43,000 3,000 Income before income taxes Income tax expense 40,000 8,000 Net income £ 32,000 Additional data: 1. Depreciation expense is £13,300. 2. Dividends declared and paid were £20,.000. 3. During the ycar, equipment was sold for £9,700 cash. This cquipmcnt cost £18,000 originally and had accumulated depreciation of £8,300 at the time of sale. Instructions a. Cash from operations £29,300 a. Prepare a statement of cash flows using the indirect method. b. Compute free cash flow.
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