The following is a condensed version of the comparative balance sheets for Zubin Mehta Corporation for the last two years at December 31. 2020 2019 Cash $177,000 $ 78,000 Accounts receivable 180,000 185,000 Investments 52,000 74,000 Equipment 298,000 240,000 Accumulated depreciation—equipment (106,000) (89,000) Current liabilities 134,000 151,000 Common stock 160,000 160,000 Retained earnings 307,000 177,000 Additional information: Investments were sold at a loss of $10,000; no equipment was sold; cash dividends paid were $30,000; and net income was $160,000. Instructions a. Prepare a statement of cash flows for 2020 for Zubin Mehta Corporation. b. Determine Zubin Mehta Corporation’s free cash flow.
The following is a condensed version of the comparative balance sheets for Zubin Mehta Corporation for the last two years at December 31. 2020 2019 Cash $177,000 $ 78,000 Accounts receivable 180,000 185,000 Investments 52,000 74,000 Equipment 298,000 240,000 Accumulated depreciation—equipment (106,000) (89,000) Current liabilities 134,000 151,000 Common stock 160,000 160,000 Retained earnings 307,000 177,000 Additional information: Investments were sold at a loss of $10,000; no equipment was sold; cash dividends paid were $30,000; and net income was $160,000. Instructions a. Prepare a statement of cash flows for 2020 for Zubin Mehta Corporation. b. Determine Zubin Mehta Corporation’s free cash flow.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The following is a condensed version of the comparative
| 2020 | 2019 | |||
| Cash | $177,000 | $ 78,000 | ||
| 180,000 | 185,000 | |||
| Investments | 52,000 | 74,000 | ||
| Equipment | 298,000 | 240,000 | ||
| (106,000) | (89,000) | |||
| Current liabilities | 134,000 | 151,000 | ||
| Common stock | 160,000 | 160,000 | ||
| 307,000 | 177,000 |
Additional information:
Investments were sold at a loss of $10,000; no equipment was sold; cash dividends paid were $30,000; and net income was $160,000.
Instructions
a. Prepare a statement of
b. Determine Zubin Mehta Corporation’s
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