E12-7 Preparing and Evaluating a Slmple Statement of Cash Flows (IndIrect Method) [LO 12-1, LO 12-2,LO 12-5]Suppose the income statement for Goggle Company reports $131 of net income, after deducting depreciation of $26. The companybought equipment costing $105 and obtained a long-term bank loan for $106. The company's comparative balance sheet, atDecember 31, is presented here.Requlred:1. Calculate the change in each balance sheet account and indicate whether each account relates to operating, investing, and/orfinancing activities (+ for increase and - for decrease).2. Prepare a statement of cash flows using the indirect method.6. Are the cash flows typical of a start-up. healthy, or troubled company?Complete this question by entering your answers in the tabs below.Required 1Required 2Required 6Calculate the change in each balance sheet account and indicate whether each account relates to operating, investing, and/orfinancing activities (+ for increase and - for decrease). (Select "NE" if there is no effect. Enter all amounts as positivevalues.)Previous Year Current YearChangeТурeCash44303250 Cash100 Operating161 Operating105 Investing26 OperatingAccounts Receivable84193+Inventory305144Equipment545650Accumulated Depreciation-Equipment(36)(62)Total9421,22849 Operating106 FinancingSalaries and Wages Payable1968Notes Payable (long-term)454560O Financing131 OperatingCommon Stock1919NERetained Earnings450581+Total9421,228< Required 1Required 2 >++++ my wE12-7 Preparlng and Evaluating a Slimple Statement of Cash Flows (Indirect Method) [LO 12-1, LO12-2, LO 12-5]Suppose the income statement for Goggle Company reports $131 of net income, after deducting depreciation of $26. Thecompany bought equipment costing $105 and obtained a long-term bank loan for $106. The company's comparative balancesheet, at December 31, is presented here.Requlred:1. Calculate the change in each balance sheet account and indicate whether each account relates to operating, investing, and.financing activities (+ for increase and - for decrease).2. Prepare a statement of cash flows using the indirect method.6. Are the cash flows typical of a start-up, healthy, or troubled company?Complete this question by entering your answers in the tabs below.Required 1Required 2Required 6Prepare a statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minussign.)GOGGLE COMPANYStatement of Cash FlowsFor the Year Ended December 31Cash Flows from Operating Activities:Net Income131Adjustments to Reconcile Net Income to Net CashProvided by Operating Activities:Depreciation26Changes in Current Assets and Current LiabilitiesIncrease in Acounts Receivable(100)Decrease in Inventory161Increase in Salaries and Wages Payable49Net Cash Provided by Operating Activities258Cash Flows from Investing Activities:Équipment Purchased(105)(105)Cash Flows from Financing Activities:Obtained Bank Loan106Net Cash Provided by Financing Activities106Net Increase in Cash250Cash, Beginning of Current Year44ICash. End of Current Year303

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Description: E12-7 Preparing and Evaluating a Slmple Statement of Cash Flows (IndIrect Method) [LO 12-1, LO 12-2,LO 12-5]Suppose the income statement for Goggle Company reports $131 of net income, after deducting depreciation of $26. The companybought equipment

The Cash Flow Statement shows the actual cash position of the firm. It includes operating,…

Business

Accounting

Suppose the income statement for Goggle Company reports $131 of net income, after deducting depreciation of $26. The company bought equipment costing $105 and obtained a long-term bank loan for $106. The company's comparative balance sheet, at December 31, is presented here. Requlred: 1. Calculate the change in each balance sheet account and indicate whether each account relates to operating. investing. andior financing activities (+ for increase and - for decrease). 2. Prepare a statement of cash flows using the indirect method. 6. Are the cash flows typical of a start-up, healthy, or troubled company?

Suppose the income statement for Goggle Company reports $131 of net income, after deducting depreciation of $26. The company bought equipment costing $105 and obtained a long-term bank loan for $106. The company's comparative balance sheet, at December 31, is presented here. Requlred: 1. Calculate the change in each balance sheet account and indicate whether each account relates to operating. investing. andior financing activities (+ for increase and - for decrease). 2. Prepare a statement of cash flows using the indirect method. 6. Are the cash flows typical of a start-up, healthy, or troubled company?

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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Some recent financial statements for Smolira Golf Corporation follow. Construct the DuPont identity for Smolira Golf Corporation.
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USE THE DATA IN THE TABLE BELOW TO ANSWER THE FOLLOWING 3 QUESTIONS LukaDonc, Incorporated Balance Sheets for the Years Ending December 31, (All amounts are in dollars) Cash Accounts receivable Inventory Total current assets Net fixed assets* Land Total assets Notes payable Accounts payable Accruals Current portion of LT Debt Total current liabilities Long-term debt Common stock Capital surplus Retained earnings Total liabilities and equity Year 1 184,600 3,322,800 1,476,800 4,984,200 11,999,000 1,476,800 18,460,000 923,000 2,215,200 553,800 2,399,800 6,091,800 5,722,600 553,800 2,215,200 3,876,600 18,460,000 Year 2 201,700 3,227,200 2,017,000 5,445,900 13,110,500 1,613,600 20,170,000 806,800 2,017,000 806,800 2,823,800 6,454,400 6,252,700 806,800 2,622,100 4,034,000 20,170,000 Additional Data from Company Income Statement(s); Sales in Year 2 Net income in Year 2 Depreciation expense in Year 1 Depreciation expense in Year 2 *No long-term assets were sold in either Year 1 or Year 2…
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Analyse the effect of each of the following transactions on the current ratio, quick ratio, debt-to-equity ratio and earnings per share. assume that the current ratio, quick ratio and debt-to-equity ratio are each greater than 1 and that earnings per share are positive. determine if the ratio increases decrease or are unchanged. consider each transaction independently of all the other transactions. Repaid short-term loans payable of $51 000. Purchased inventory of $48 000 on cash. Made repayments of $78 000 on the long-term loan. Declared, but did not pay, a $31 000 cash dividend on shares. Borrowed an additional $56 000 on the long-term loan. Sold short-term investments recorded in the balance sheet at $30 000 for $28 000. Issued 140 000 shares at the beginning of the financial period for cash of $168 000. Received $6000 owing in cash from a customer.
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