The comparative balance sheet of Yellow Dog Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows: Question not attempted. 1 Dec. 31, 20Y8 Dec. 31, 20Y7 2 Assets 3 Cash $80,000.00 $100,000.00 4 Accounts receivable (net) 275,000.00 300,000.00 5 Merchandise inventory 510,000.00 400,000.00 6 Prepaid expenses 15,000.00 10,000.00 7 Equipment 1,070,000.00 750,000.00 8 Accumulated depreciation (200,000.00) (160,000.00) 9 Total assets $1,750,000.00 $1,400,000.00 10 Liabilities and Stockholders’ Equity 11 Accounts payable (merchandise creditors) $100,000.00 $90,000.00 12 Mortgage note payable 0.00 400,000.00 13 Common stock, $10 par 600,000.00 200,000.00 14 Paid-in capital: Excess of issue price over par—common stock 300,000.00 100,000.00 15 Retained earnings 750,000.00 610,000.00 16 Total liabilities and stockholders’ equity $1,750,000.00 $1,400,000.00 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, $190,000. B. Depreciation reported on the income statement, $115,000. C. Equipment was purchased at a cost of $395,000, and fully depreciated equipment costing $75,000 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. 40,000 shares of common stock were issued at $15 for cash. F. Cash dividends declared and paid, $50,000. Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities The section of the statement of cash flows that reports the cash transactions affecting the determination of net income. . Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. 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, and enter in the order listed on the Instructions page.

The comparative balance sheet of Yellow Dog Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows: Question not attempted. 1 Dec. 31, 20Y8 Dec. 31, 20Y7 2 Assets 3 Cash $80,000.00 $100,000.00 4 Accounts receivable (net) 275,000.00 300,000.00 5 Merchandise inventory 510,000.00 400,000.00 6 Prepaid expenses 15,000.00 10,000.00 7 Equipment 1,070,000.00 750,000.00 8 Accumulated depreciation (200,000.00) (160,000.00) 9 Total assets $1,750,000.00 $1,400,000.00 10 Liabilities and Stockholders’ Equity 11 Accounts payable (merchandise creditors) $100,000.00 $90,000.00 12 Mortgage note payable 0.00 400,000.00 13 Common stock, $10 par 600,000.00 200,000.00 14 Paid-in capital: Excess of issue price over par—common stock 300,000.00 100,000.00 15 Retained earnings 750,000.00 610,000.00 16 Total liabilities and stockholders’ equity $1,750,000.00 $1,400,000.00 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, $190,000. B. Depreciation reported on the income statement, $115,000. C. Equipment was purchased at a cost of $395,000, and fully depreciated equipment costing $75,000 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. 40,000 shares of common stock were issued at $15 for cash. F. Cash dividends declared and paid, $50,000. Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities The section of the statement of cash flows that reports the cash transactions affecting the determination of net income. . Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. 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, and enter in the order listed on the Instructions page.

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 Yellow Dog Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows:

Question not attempted.

1		Dec. 31, 20Y8	Dec. 31, 20Y7
2	Assets
3	Cash	$80,000.00	$100,000.00
4	Accounts receivable (net)	275,000.00	300,000.00
5	Merchandise inventory	510,000.00	400,000.00
6	Prepaid expenses	15,000.00	10,000.00
7	Equipment	1,070,000.00	750,000.00
8	Accumulated depreciation	(200,000.00)	(160,000.00)
9	Total assets	$1,750,000.00	$1,400,000.00
10	Liabilities and Stockholders’ Equity
11	Accounts payable (merchandise creditors)	$100,000.00	$90,000.00
12	Mortgage note payable	0.00	400,000.00
13	Common stock, $10 par	600,000.00	200,000.00
14	Paid-in capital: Excess of issue price over par—common stock	300,000.00	100,000.00
15	Retained earnings	750,000.00	610,000.00
16	Total liabilities and stockholders’ equity	$1,750,000.00	$1,400,000.00

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, $190,000.
B.	Depreciation reported on the income statement, $115,000.
C.	Equipment was purchased at a cost of $395,000, and fully depreciated equipment costing $75,000 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.	40,000 shares of common stock were issued at $15 for cash.
F.	Cash dividends declared and paid, $50,000.

Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities

The section of the statement of cash flows that reports the cash transactions affecting the determination of net income.

. Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. 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, and enter in the order listed on the Instructions page.

Yellow Dog Enterprises Inc.
Score: 141/154
Statement of Cash Flows
For the Year Ended December 31, 20Y8
1 Cash flows from operating activities
Net income
$190,000.00
3 Adjustments to reconcile net income to net cash flow from operating adivities.
Depreciation
115,000.00
Changes in current operating assets and liabilities
Decrease in accounts recenable
25,000.00
7.
Increase in merchandise inventory
110,000.00)
Increase in prepaid expenses
(5,000.00)
Increase in accounts payable
10,000.00
10
Net cash flow from operating activities

10
Net cash flow from operating activities
11
12 Cash flows from (used for) investing activities.
SE595,000.00]
13
Cash used for equipment
(395,000.00)
14
Net cash flow used for investing activities
15
14 Cash flows from (used for) financing activities:
$600,000.00
17
Cash from sale of common stodk
Cash used to retire mortgage note payable
(400,000.00]
13
(50,000.00)
19
150,000.00
20
Net Cash flow from financing activities
21 Decrease in cash
$(20,000.00)
100,000.00
22 Cash at the beginning of the year
23 Cash at the end of the year
$80,000.00

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