The following information has been reported by Laporte Inc. on its statements of financial position at December 31, 2016 and 2017, and on its statement of earnings for the year ended December 31, 2017. Amounts are in millions of dollars: Statements of Financial Position 2017 2016 $ 100 $ 75 Cash Accounts receivable Merchandise inventory Long-term investments Property, plant, and equipment Accumulated depreciation 50 38 41 46 32 168 (82) 224 (72) Total assets $343 $277 $ 38 7 Accounts payable Income taxes payable Long-term borrowings Contributed capital Retained earnings 52 8. 95 139 35 130 52 64 Total liabilities and shareholders' equity $343 $277 Statement of Earnings $ 175 (105) Sales Cost of sales Gross profit Depreciation expense Other operating expenses 70 (10) (42) Earnings from operations Gain on sale of investments 18 8 Loss on sale of equipment (2) Earnings before income tax Income tax expense 24 Net earnings $ 16 Additional information is as follows: a. Old equipment was sold for cash during 2017. It had an original cost of $34 and an accumulated depreciation of $20. b. A new building was acquired during the year in exchange for a long-term note for $60, payable in five years. In addition, new equipment was purchased for cash. Required: 1. Prepare the operating activities section of the statement of cash flows for Laporte Inc. for the year ended December 31, 2017 by using the indirect method. (Negative answers should be indicated by a minus sign. Enter your answers in millions.) LAPORTE INC. Statement of Cash Flows (Partial) For the Year Ended December 31, 2017 Cash flows from operating activities: Net earnings Add (deduct) items not affecting cash: 2$ 16 Depreciation expense 10
The following information has been reported by Laporte Inc. on its statements of financial position at December 31, 2016 and 2017, and on its statement of earnings for the year ended December 31, 2017. Amounts are in millions of dollars: Statements of Financial Position 2017 2016 $ 100 $ 75 Cash Accounts receivable Merchandise inventory Long-term investments Property, plant, and equipment Accumulated depreciation 50 38 41 46 32 168 (82) 224 (72) Total assets $343 $277 $ 38 7 Accounts payable Income taxes payable Long-term borrowings Contributed capital Retained earnings 52 8. 95 139 35 130 52 64 Total liabilities and shareholders' equity $343 $277 Statement of Earnings $ 175 (105) Sales Cost of sales Gross profit Depreciation expense Other operating expenses 70 (10) (42) Earnings from operations Gain on sale of investments 18 8 Loss on sale of equipment (2) Earnings before income tax Income tax expense 24 Net earnings $ 16 Additional information is as follows: a. Old equipment was sold for cash during 2017. It had an original cost of $34 and an accumulated depreciation of $20. b. A new building was acquired during the year in exchange for a long-term note for $60, payable in five years. In addition, new equipment was purchased for cash. Required: 1. Prepare the operating activities section of the statement of cash flows for Laporte Inc. for the year ended December 31, 2017 by using the indirect method. (Negative answers should be indicated by a minus sign. Enter your answers in millions.) LAPORTE INC. Statement of Cash Flows (Partial) For the Year Ended December 31, 2017 Cash flows from operating activities: Net earnings Add (deduct) items not affecting cash: 2$ 16 Depreciation expense 10
Chapter1: Financial Statements And Business Decisions
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