College Accounting, Chapters 1-27
23rd Edition
ISBN: 9781337794756
Author: HEINTZ, James A.
Publisher: Cengage Learning,
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Chapter 23, Problem 5SEB
To determine
Prepare a statement of
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Use the following excerpts from Nutmeg Company's financial records to determine net cash flows from operating activities and net cash flows from investing
activities.
Net income this year
Purchased land this year
Sold investments this year
Original cost of investments that were sold
$83,700
20,000
31,500
33,000
PLEASE NOTE: All whole dollar amounts will be with "$" and commas as needed (i.e. $12,345).
Net cash flows from operating activities
Net cash flows from investing activities
Shim Company presents its statement of cash flows using the indirect method.
The following accounts and corresponding balances were drawn from Shim’s Year 2 and Year 1 year-end balance sheets. (see below).
The income statement reported a $2,280 gain on the sale of equipment, an $810 loss on the sale of land, and $4,200 of depreciation expense. Net income for the period was $45,800.
Requirements:
Prepare the operating activities section of the statement of cash flows.
Account
Year 2
Year 1
Accounts Receivable
31,200.00
35,000.00
Prepaid Rent
1,453.00
1,100.00
Interest Receivable
650.00
600.00
Accounts Payable
9,876.00
12,200.00
Salaries Payable
2,625.00
2,000.00
Unearned Revenue
3,237.00
4,470.00
Shim Company
Cash from Operating Activities
How would I record the statement of cash flow?
Chapter 23 Solutions
College Accounting, Chapters 1-27
Ch. 23 - True/False The purpose of the statement of cash...Ch. 23 - Investing activities are those transactions...Ch. 23 - An increase in accounts receivable is deducted...Ch. 23 - Prob. 4TFCh. 23 - Prob. 5TFCh. 23 - Prob. 1MCCh. 23 - Prob. 2MCCh. 23 - Prob. 3MCCh. 23 - Prob. 4MCCh. 23 - Prob. 5MC
Ch. 23 - Prob. 1CECh. 23 - Prob. 2CECh. 23 - Prob. 3CECh. 23 - Prob. 4CECh. 23 - Prob. 5CECh. 23 - Prob. 6CECh. 23 - Prob. 7CECh. 23 - Prob. 8CECh. 23 - Prob. 1RQCh. 23 - Prob. 2RQCh. 23 - Prob. 3RQCh. 23 - Prob. 4RQCh. 23 - Prob. 5RQCh. 23 - Prob. 6RQCh. 23 - Prob. 7RQCh. 23 - Prob. 8RQCh. 23 - Prob. 9RQCh. 23 - Prob. 10RQCh. 23 - Prob. 11RQCh. 23 - Prob. 12RQCh. 23 - Prob. 13RQCh. 23 - Prob. 14RQCh. 23 - Prob. 15RQCh. 23 - Prob. 16RQCh. 23 - Prob. 17RQCh. 23 - Prob. 18RQCh. 23 - Prob. 19RQCh. 23 - Prob. 20RQCh. 23 - Prob. 21RQCh. 23 - SERIES A EXERCISES IDENTIFICATION OF OPERATING,...Ch. 23 - CHANGE IN CASH AND CASH EQUIVALENTS Olsen Companys...Ch. 23 - Prob. 3SEACh. 23 - Prob. 4SEACh. 23 - GAINS AND LOSSES ON THE SALE OF LONG-TERM ASSETS...Ch. 23 - Prob. 6SEACh. 23 - Prob. 7SEACh. 23 - CASH PAID FOR INTEREST Ball Companys income...Ch. 23 - Prob. 9SPACh. 23 - Prob. 10SPACh. 23 - COMPUTE CASH PROVIDED BY OPERATING ACTIVITIES Horn...Ch. 23 - EXPANDED STATE MENT OF CASH FLOWS Financial...Ch. 23 - Prob. 1SEBCh. 23 - Prob. 2SEBCh. 23 - Prob. 3SEBCh. 23 - Prob. 4SEBCh. 23 - Prob. 5SEBCh. 23 - Prob. 6SEBCh. 23 - Prob. 7SEBCh. 23 - Prob. 8SEBCh. 23 - Prob. 9SPBCh. 23 - Prob. 10SPBCh. 23 - COMPUTE CASH PROVIDED BY OPERATING ACTIVITIES...Ch. 23 - EXPANDED STATEMENT OF CASH FLOWS Financial...Ch. 23 - MANAGING YOUR WRITING Direct Method A friend of...Ch. 23 - MASTERY PROBLEM Financial statements for...Ch. 23 - CHALLENGE PROBLEM The long-term liabilities...
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- State the section(s) of the statement of cash flows prepared by the indirect method (operating activities, investing activities, financing activities, or not reported) and the amount that would be reported for each of the following transactions: Note: Only consider the cash component of each transaction. Note: If an item should not be reported, select "Not reported" and leave amount cell blank or enter "0". a. Received $120,000 from the sale of land costing $70,000. operatin financing investing not reported $fill in the blank 2 fill in blank $fill in the blank 4 b. Purchased investments for $75,000. fill in blank $fill in the blank 6 c. Declared $35,000 cash dividends on stock. Dividends of $5,000 were payable at the beginning of the year, and $6,000 were payable at the end of the year. fill in blank $fill in the blank 8 d. Acquired equipment for $64,000 cash. fill in blank $fill in the blank 10 e. Declared and issued 100 shares of $20 par common stock as…arrow_forwardState the section(s) of the statement of cash flows prepared by the indirect method (operating activities, investing activities, financing activities, or not reported) and the amount that would be reported for each of the following transactions: Note: Only consider the cash component of each transaction. Note: If an item should not be reported, select "Not reported" and leave amount cell blank or enter "0". a. Received $120,000 from the sale of land costing $70,000. $fill in the blank 2 $fill in the blank 4 b. Purchased investments for $75,000. $fill in the blank 6 c. Declared $35,000 cash dividends on stock. $5,000 dividends were payable at the beginning of the year, and $6,000 were payable at the end of the year. $fill in the blank 8 d. Acquired equipment for $64,000 cash. $fill in the blank 10 e. Declared and issued 100 shares of $20 par common stock as a stock dividend, when the market price of the stock was $32 a share. $fill in the blank 12…arrow_forward) Provide an accurate, full and complete explanation and implication of the information presented in (mathematical forms) by explaining the significance of the cash flow statement The net income reported on the income statement for the current year was $128,000. Depreciation recorded on store equipment for the year amounted to $21,100. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $51,200 $47,100 Accounts receivable (net) 36,710 34,810 Merchandise inventory 50,120 52,990 Prepaid expenses 5,630 4,470 Accounts payable (merchandise creditors) 47,970 44,560 Wages payable 26,210 29,110arrow_forward
- Need Help.arrow_forwardComplete the following Spreadsheet for the preparation of statement of cash flows under the indirect method. (The statement of cash flows is not required.) (Enter all amounts as positive values.) Additional information: a. Net income for the year was $105,000. b. Dividends of $90,000 cash were declared and paid. c. The only noncash expense was $75,000 of depreciation. d. Purchased plant assets for $95,000 cash. e. Notes payable of $25,000 were issued for $25,000 cash. f. $55,000 increase in accounts receivable. g. $35,000 decrease in inventory. h. $15,000 decrease in accounts payable. Balance Sheet-Debit Balance Accounts Cash Accounts receivable Inventory Plant assets Balance Sheet-Credit Balance Accounts Accumulated depreciation Accounts payable Notes payable Common stock Retained earnings Statement of Cash Flows Operating activities SCORETECK CORPORATION Spreadsheet for Statement of Cash Flows-Indirect Method For Year Ended December 31, 2021 Investing activities Financing activities…arrow_forwardPlease see attachments for detailsarrow_forward
- Using the Exhibit below, assume that the amount of Net Income on the Income Statement for the year was $100,000. When preparing the Statement of Cash Flow using the indirect method for the current year, which of the following statements would describe the proper presentation of net income on the Cash flow from operating activities section? EXHIBIT Increase (Decrease) Net Income (loss) $XXX Adjustments to reconcile net income to net cash flow from operating activities: Depreciation of fixed assets XXX Losses on disposal of assets XXX Gains on disposal of assets (XXX) Changes in current operating assets and liabilities:…arrow_forwardAn analysis of the general ledger accounts indicates that equipment, with an original cost of $200,000 and accumulated depreciation of $170,000 on the date of sale, was sold for $20,000 during the year. Using this information, indicate the items to be reported on the statement of cash flows using the indirect method. Cash flows from operating activities: $ Cash flows from investing activities: $arrow_forwardusing the image attached , please prepare the cash flow statement for the year. Also alongside the given image the following additional infromation should be noted for the account as well : 1. The building was revalued during the year.2. Equipment costing 25,000 for which there a provision for depreciation of 5,500was sold for a profit of 6,000.3. Dividends paid and proposed for the year amounted to 27,000arrow_forward
- On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cash flows: Date Item Debit Credit BalanceDebit BalanceCredit January 1 Balance 319,900 February 10 Purchased for cash 499,000 818,900 November 20 Purchased with long-term mortgage note 663,300 1,482,200 Item Section of Statement of Cash Flows Added or Deducted Amount Purchase of land for cash $fill in the blank 3 Purchase of land by issuinglong-term mortgage note $fill in the blank 6arrow_forwardThe net income reported on an income statement for the current year was $63,000. Depreciation recorded on fixed assets for the year was $24,000. Balances of the current asset and current liability accounts at the end and beginning of the year are listed below. Prepare the Cash Flows from Operating Activities section of the statement of cash flows using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. End Beginning Cash $65,000 $70,000 Accounts receivable (net) 70,000 57,000 Inventories 86,000 102,000 Prepaid expenses 4,000 4,500 Accounts payable (merchandise creditors) 51,000 58,000 Cash dividends payable 4,500 6,500 Salaries payable 6,000 7,500 Cash Flows from Operating Activities Section Cash flows from operating activities: $ Adjustments to reconcile net income to net cash flow from operating activities: Changes in current…arrow_forwardProceeds from the sale of equipment by Perkins Nonprofit were $100. The equipment had a historical cost of $500 and accumulated depreciation of $375. Show which section of the statement of cash flows (using the indirect method) where amounts related to this transaction would appear, including direction and amount.arrow_forward
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