The comparative balance sheet of Orange Angel Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows: 1 Dec. 31, 20Y8 Dec. 31, 20Y7 2 Assets 3 Cash $146,190.00 $179,070.00 4 Accounts receivable (net) 224,940.00 241,100.00 5 Merchandise inventory 322,390.00 299,700.00 6 Prepaid expenses 12,670.00 9,430.00 7 Equipment 655,160.00 537,730.00 8 Accumulated depreciation-equipment (170,790.00) (131,900.00) 9 Total assets $1,190,560.00 $1,135,130.00 10 Liabilities and Stockholders’ Equity 11 Accounts payable (merchandise creditors) $250,640.00 $237,300.00 12 Mortgage note payable 0.00 336,600.00 13 Common stock, $10 par 73,000.00 23,000.00 14 Excess of paid-in capital over par 500,000.00 310,000.00 15 Retained earnings 366,920.00 228,230.00 16 Total liabilities and stockholders’ equity $1,190,560.00 $1,135,130.00 Additional data obtained from the income statement and from an examination of the accounts in the ledger for 20Y8 are as follows: a. Net income, $291,590. b. Depreciation reported on the income statement, $83,790. c. Equipment was purchased at a cost of $162,330, and fully depreciated equipment costing $44,900 was discarded, with no salvage realized. d. The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty. e. 10,000 shares of common stock were issued at $24 for cash. f. Cash dividends declared and paid, $152,900. Required: Prepare a statement of cash flows, using the indirect method of presenting cash flows from (used for) operating activities. Be sure to complete the heading of the statement. Use the minus sign to indicate cash outflows, decreases in cash and a net cash outflow for each section, if required

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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Question

The comparative balance sheet of Orange Angel Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows:

1		Dec. 31, 20Y8	Dec. 31, 20Y7
2	Assets
3	Cash	$146,190.00	$179,070.00
4	Accounts receivable (net)	224,940.00	241,100.00
5	Merchandise inventory	322,390.00	299,700.00
6	Prepaid expenses	12,670.00	9,430.00
7	Equipment	655,160.00	537,730.00
8	Accumulated depreciation-equipment	(170,790.00)	(131,900.00)
9	Total assets	$1,190,560.00	$1,135,130.00
10	Liabilities and Stockholders’ Equity
11	Accounts payable (merchandise creditors)	$250,640.00	$237,300.00
12	Mortgage note payable	0.00	336,600.00
13	Common stock, $10 par	73,000.00	23,000.00
14	Excess of paid-in capital over par	500,000.00	310,000.00
15	Retained earnings	366,920.00	228,230.00
16	Total liabilities and stockholders’ equity	$1,190,560.00	$1,135,130.00

Additional data obtained from the income statement and from an examination of the accounts in the ledger for 20Y8 are as follows:

a.	Net income, $291,590.
b.	Depreciation reported on the income statement, $83,790.
c.	Equipment was purchased at a cost of $162,330, and fully depreciated equipment costing $44,900 was discarded, with no salvage realized.
d.	The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty.
e.	10,000 shares of common stock were issued at $24 for cash.
f.	Cash dividends declared and paid, $152,900.

Required:

Prepare a statement of cash flows, using the indirect method of presenting cash flows from (used for) operating activities. Be sure to complete the heading of the statement. Use the minus sign to indicate cash outflows, decreases in cash and a net cash outflow for each section, if required.