Purchase of equipment $ 221,000 Increase in inventory 27,000 Increase in prepaid rent Payment of dividends Depreciation expense 8,500 33,000 12,000 Increase in accounts receivable 47,000 Increase in accounts payable 16,000 Loss on sale of land 14,500 Net income 63,000 Repayment of notes payable 43,000 Cash received from the sale of land 4,000 Issuance of common stock 243,000

Purchase of equipment $ 221,000 Increase in inventory 27,000 Increase in prepaid rent Payment of dividends Depreciation expense 8,500 33,000 12,000 Increase in accounts receivable 47,000 Increase in accounts payable 16,000 Loss on sale of land 14,500 Net income 63,000 Repayment of notes payable 43,000 Cash received from the sale of land 4,000 Issuance of common stock 243,000

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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Effect of Transactions on Cash Flows State the effect (cash receipt or payment and amount) of each of the following transactions, considered individually, on cash flows: a. Retired $310,000 of bonds, on which there was $3,100 of unamortized discount, for $322,000. b. Sold 7,000 shares of $30 par common stock for $59 per share. c. Sold equipment with a book value of $48,700 for $70,100. d. Purchased land for $406,000 cash. e. Purchased a building by paying $51,000 cash and issuing a $110,000 mortgage note payable. f. Sold a new issue of $180,000 of bonds at 99. g. Purchased 2,900 shares of $25 par common stock as treasury stock at $46 per share. h. Paid dividends of $2.00 per share. There were 25,000 shares issued and 4,000 shares of treasury stock. a. b. C. d. e. f. 9. h. Effect Amount
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Cash Flows from Operating Activities-Indirect Method The income statement disclosed the following items for the year: Depreciation expense $52,000 Gain on disposal of 30,330 equipment Net income 382,200 The changes in the current asset and liability accounts for the year are as follows: Increase (Decrease) Accounts receivable $8,100 Inventory (4,610) Prepaid insurance (1,730) Accounts payable (5,490) Income taxes payable 1,730 Dividends payable 1,210 a. Prepare the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: Adjustments to reconcile net income to net cash flow from operating activities: Changes in current operating assets and liabilities: Net cash flow from operating activities
Complete the statement of sources and uses of cash from the following entries: Net income $ 3,500 Dividends 900 Additions to inventory 320 Additions to receivables 350 Depreciation 290 Reduction in payables 750 Net issuance of long-term debt 500 Sale of fixed assets 260 Sources ___________ Additions to inventory ____________ Decrease in Accounts Payable Depreciation Increase in Accounts receivable Cash from operations Additions to inventory ___________ Decrease in accounts payable ___________ Depreciation Increase in accounts receiveable Total Sources Uses Additions to inventory ___________ Decrease in accounts payable ___________…
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $154,100. Depreciation recorded on store equipment for the year amounted to $25,400. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $58,560 $53,290 Accounts receivable (net) 41,990 39,380 Inventories 57,330 59,950 Prepaid expenses 6,440 5,060 Accounts payable (merchandise creditors) 54,870 50,410 Wages payable 29,980 32,930 a. Prepare the “Cash flows from operating activities” section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash flow…
Cash Flows from Operating Activities—Indirect Method The income statement disclosed the following items for the year: Depreciation expense $53,700 Gain on disposal of equipment 31,310 Net income 391,700 The changes in the current asset and liability accounts for the year are as follows: Increase(Decrease) Accounts receivable $8,360 Inventory (4,760) Prepaid insurance (1,780) Accounts payable (5,670) Income taxes payable 1,780 Dividends payable 1,250 a. Prepare the “Cash flows from operating activities” section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash flow from operating activities: Depreciation Gain on disposal of equipment Changes in current operating assets and…
9. What is the amount of depreciation under cash basis?
Cash flow from operating activity????
How much is the ending cash balance?
Decrease in plant and equipment $ Decrease in deferred tax asset $ Increase in accounts receivable $ Net Loss $ 122,865 587,458 15,487 65,892 109,520 215,877 Increase in inventory $ Decrease in short-term debt $ Net cash from financing activities Net cash from investing activities Net cash from operating activities
Effect of Transactions on Cash Flows State the effect (cash receipt or cash payment and amount) of each of the following transactions, considered individually, on cash flows: Retired $320,000 of bonds, on which there was $3,200 of unamortized discount, for $333,000. Sold 7,000 shares of $10 par common stock for $17 per share. Sold equipment with a book value of $56,600 for $81,500. Purchased land for $386,000 cash. Purchased a building by paying $70,000 cash and issuing a $100,000 mortgage note payable. Sold a new issue of $240,000 of bonds at 98. Purchased 6,400 shares of $40 par common stock as treasury stock at $75 per share. Paid dividends of $1.50 per share. There were 24,000 shares issued and 4,000 shares of treasury stock. Effect Amount a. Cash payment $fill in the blank 2 b. Cash receipt $fill in the blank 4 c. Cash receipt $fill in the blank 6 d. Cash payment $fill in the blank 8 e. Cash payment $fill in the blank 10 f. Cash receipt $fill in the blank…
Days' cash on hand Financial statement data for years ending December 31 for Newton Company follow: 20Y9 20Υ8 Cash (end of year) $24,665 $24,840 Short-term investments (end of year) 8,210 9,480 Operating expenses 59,050 64,095 Depreciation expense 13,425 Determine the days' cash on hand for 20Y8 and 20Y9. Assume 365 days in a year. Days' Cash on Hand 20Y8: days 20Y9: days P. > Check My Work Save and Exit Submi All work saved.