Horngren's Financial & Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780133866292
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
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Chapter 14, Problem 14.39BP
1.
To determine
Statement of
The purpose of the statement of cash flows:
2.
To determine
To Prepare: Single step income statement of FRC for the year ended December 31, 2016 (using single-step format).
3.
To determine
To Prepare: The
4.
To determine
To Prepare: Statement of cash flows under indirect method.
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Preparing the statement of cash flows—direct methodDiversion Rare Coins (DRC) was formed on January 1, 2018. Additional data for the year follow:
a. On January 1, 2018, DRC issued no par common stock for $450,000.
b. Early in January, DRC made the following cash payments:
For store fixtures, $46,000
For merchandise inventory, $310,000
For rent expense on a score building, $18,000
c. Later in the year, DRC purchased merchandise inventory on account for $238,000. Before year-end, DRC paid $138,000 of this accounts payable.
d. During 2018, DRC sold 2,700 units of merchandise inventory for $400 each. Before year-end, the company collected 85% of this amount. Cost of goods sold or the year was $340,000, and ending merchandise inventory totaled $208,000.
e. The store employs three people. The combined annual payroll is $97,000, of which DRC still owes $6,000 at year-end.
f. Ac the end of the year, DRC paid income tax of $18,000. There was no income taxes payable.
g. Late in 2018, DRC paid…
Identifying the purpose and preparing the statement of cash flows — indirect method
Classic Rare Coins (CRC) was formed on January 1, 2018. Additional data for the year follow:
a. On January 1, 2018, CRC issued no par common stock for $525,000.
b. Early in January, CRC made the Following cash payments:
For store fixtures, $51,000
For merchandise inventory, $240,000
For rent expense on a store building, $18,000
c. Later in the year, CRC purchased merchandise inventory on account for $243,000. Before year-end, CRC paid $153,000 of this accounts payable.
d. During 2018, CRC sold 2,800 units of merchandise inventory for $325 each. Before year-end, the company collected 95% of this amount. Cost of goods sold for the year was $290,000, and ending merchandise inventory totaled $193,000.
e. The store employs three people. The combined annual payroll is $82,000, of which CRC still owes $5„000 at year-end.
f. At the end of the year, CRC paid income tax of $17,000. There was no income taxes…
Identifying the purpose and preparing the statement of cash flows—indirect method
American Rare Coins (ARC) was formed on January 1, 2018. Additional data for the year follow:
a. On January 1, 2018, ARC issued no par common stock for $450,000.
b. Early in January, ARC made the following cash payments:
For store fixtures, $53,000
For merchandise inventory, $340,000
For rent expense on a store building, $20,000
c. Later in the year, ARC purchased merchandise inventory on account for $239,000. Before year-end, ARC paid $139,000 of this accounts payable.
d. During 2018, ARC sold 2,400 units of merchandise inventory for $275 each. Before year-end, the company collected 85% of this amount. Cost of goods sold for the year was $250,000, and ending merchandise inventory totalled $329,000.
e. The store employs three people. The combined annual payroll is $96,000, of which ARC still owes $3,000 at year-end.
f. At the end of the year, ARC paid income tax of $17,000. There are no income taxes…
Chapter 14 Solutions
Horngren's Financial & Managerial Accounting (5th Edition)
Ch. 14 - The purposes of the statement of cash flows are to...Ch. 14 - The main categories of cash flow activities are a....Ch. 14 - Operating activities are most closely related to...Ch. 14 - Which item does not appear on a statement of cash...Ch. 14 - Leather Shop earned net income of 57,000 after...Ch. 14 - The Plant Assets account and Accumulated...Ch. 14 - Mountain Water Corp. issued common stock of 28,000...Ch. 14 - Prob. 8QCCh. 14 - Prob. 9AQCCh. 14 - If accrued liabilities increased during the year,...
Ch. 14 - Prob. 1RQCh. 14 - How does the statement of cash flows help users of...Ch. 14 - Describe the three basic types of cash flow...Ch. 14 - What types of transactions are reported in the...Ch. 14 - Prob. 5RQCh. 14 - Prob. 6RQCh. 14 - Explain why depreciation expense, depletion...Ch. 14 - Prob. 8RQCh. 14 - If current assets other than cash increase, what...Ch. 14 - If current liabilities increase, what is the...Ch. 14 - Prob. 11RQCh. 14 - Prob. 12RQCh. 14 - Prob. 13RQCh. 14 - Prob. 14RQCh. 14 - Prob. 15ARQCh. 14 - Prob. 16BRQCh. 14 - Describing the purposes of the statement of cash...Ch. 14 - Prob. 14.2SECh. 14 - Classifying items on the indirect statement of...Ch. 14 - Computing cash flows from operating...Ch. 14 - Prob. 14.5SECh. 14 - Prob. 14.6SECh. 14 - Prob. 14.7SECh. 14 - Prob. 14.8SECh. 14 - Prob. 14.9SECh. 14 - Prob. 14.10SECh. 14 - Preparing a statement of cash flows using the...Ch. 14 - Prob. 14.12SECh. 14 - Preparing the direct method statement of cash...Ch. 14 - Prob. 14.14SECh. 14 - Prob. 14.15SECh. 14 - Classifying cash flow items Consider the following...Ch. 14 - Prob. 14.17ECh. 14 - Prob. 14.18ECh. 14 - Prob. 14.19ECh. 14 - Prob. 14.20ECh. 14 - Prob. 14.21ECh. 14 - Prob. 14.22ECh. 14 - Prob. 14.23ECh. 14 - Prob. 14.24ECh. 14 - Prob. 14.25ECh. 14 - Prob. 14.26ECh. 14 - Prob. 14.27ECh. 14 - Prob. 14.28ECh. 14 - Prob. 14.29ECh. 14 - Prob. 14.30ECh. 14 - Using a spreadsheet to prepare the statement of...Ch. 14 - Prob. 14.32APCh. 14 - Prob. 14.33APCh. 14 - Prob. 14.34APCh. 14 - Prob. 14.35APCh. 14 - Preparing the statement of cash flows----direct...Ch. 14 - Prob. 14.37APCh. 14 - Prob. 14.38APCh. 14 - Prob. 14.39BPCh. 14 - Prob. 14.40BPCh. 14 - Prob. 14.41BPCh. 14 - Prob. 14.42BPCh. 14 - Prob. 14.43BPCh. 14 - Prob. 14.44BPCh. 14 - Using a spreadsheet to prepare the statement of...Ch. 14 - Prob. 14.46CPCh. 14 - Prob. 14.1CTDCCh. 14 - Moss Exports is having a bad year. Net income is...Ch. 14 - Details about a company's cash flows appear in a...
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