Preparing the statement of cash flows—direct method The income statement and additional data of Value Corporation follow: a. Collections from customers are $13,000 more than sales. b. Dividend revenue, interest expense, and income tax expense equal their cash amounts. c. Payments to suppliers are the sum of cost of goods sold plus advertising expense. d. Payments to employees are $3,000 more than salaries expense. e. Cash payment for the acquisition of plant assets is $102,000. f. Cash receipts from sale of land total $29,000. g. Cash receipts from issuance of common stock total $38,000. h. Payment of long-term notes payable is $10,000. i. Payment of dividends is $9,000. j. Cash balance at June 30, 2017, was $21,000; at June 30, 2018, it was $43,000. Prepare Value Corporation’s statement of cash flows for the year ended June 30, 2018. Use the direct method.
Preparing the statement of cash flows—direct method The income statement and additional data of Value Corporation follow: a. Collections from customers are $13,000 more than sales. b. Dividend revenue, interest expense, and income tax expense equal their cash amounts. c. Payments to suppliers are the sum of cost of goods sold plus advertising expense. d. Payments to employees are $3,000 more than salaries expense. e. Cash payment for the acquisition of plant assets is $102,000. f. Cash receipts from sale of land total $29,000. g. Cash receipts from issuance of common stock total $38,000. h. Payment of long-term notes payable is $10,000. i. Payment of dividends is $9,000. j. Cash balance at June 30, 2017, was $21,000; at June 30, 2018, it was $43,000. Prepare Value Corporation’s statement of cash flows for the year ended June 30, 2018. Use the direct method.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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E16A-28 Preparing the statement of
a. Collections from customers are $13,000 more than sales.
b. Dividend revenue, interest expense, and income tax expense equal their cash amounts.
c. Payments to suppliers are the sum of cost of goods sold plus advertising expense.
d. Payments to employees are $3,000 more than salaries expense.
e. Cash payment for the acquisition of plant assets is $102,000.
f. Cash receipts from sale of land total $29,000.
g. Cash receipts from issuance of common stock total $38,000.
h. Payment of long-term notes payable is $10,000.
i. Payment of dividends is $9,000.
j. Cash balance at June 30, 2017, was $21,000; at June 30, 2018, it was $43,000.
Prepare Value Corporation’s statement of cash flows for the year ended June 30, 2018. Use the direct method.
Transcribed Image Text:Learning Objective 4
Appendix 16A
E16A-28 Preparing the statement of cash flows-direct method
The income statement and additional data of Value Corporation follow:
Net Cash Prov. by Op.
Act. $76,000
VALUE CORPORATION
Income Statement
Year Ended June 30, 2018
Net Sales Revenue
$ 233,000
Cost of Goods Sold
104,000
Gross Profit
129,000
Operating Expenses:
Salaries Expense
$ 48,000
Depreciation Expense-Plant Assets
21,000
Advertising Expense
12,000
Total Operating Expenses
81,000
Operating Income
48,000
Other Income and (Expenses):
Dividend Revenue
7,000
Interest Expense
(2,500)
Total Other Income and (Expenses)
4,500
Net Income Before Income Taxes
52,500
Income Tax Expense
7,500
Net Income
$ 45,000
a. Collections from customers are $13,000 more than sales.
b. Dividend revenue, interest expense, and income tax expense equal their cash
amounts.
c. Payments to suppliers are the sum of cost of goods sold plus advertising
expense.
d. Payments to employees are $3,000 more than salaries expense.
e. Cash payment for the acquisition of plant assets is $102,000.
f. Cash rececipts from sale of land total $29,000.
g Cash receipts from issuance of common stock total $38,000,
h. Payment of long-term notes payable is $10,000,
i. Payment of dividends is $9,000.
j. Cash balance at June 30, 2017, was $21,000; at June 30, 2018, it was $43,000.
Prepare Value Corporation's statement of cash flows for the year ended June 30, 2018.
Use the direct method.
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