Exercise 12-14 The following information is available for Sunland Company for 20

Question

Exercise 12-14 The following information is available for Sunland Company for 2017. Cash used to purchase treasury stock $ 151,996 Cash dividends paid 68,888 Cash paid for interest 70,784 Net income 1,467,188 Sales revenue 2,534,320 Cash paid for taxes 312,840 Cash received from customers 1,788,876 Cash received from sale of building (at book value) 624,416 Cash paid for operating expenses 243,320 Beginning cash balance 34,760 Cash paid for goods and services 881,956 Cash received from issuing common stock 1,121,800 Cash paid to redeem bonds at maturity 632,000 Cash paid to purchase equipment 357,712 Prepare a statement of cash flows using the direct method. (Show amounts in the investing and financing sections that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) Sunland Company Statement of Cash Flows—Direct Method $ : $ $

Explanation / Answer

Prepare a statement of cash flows using the direct method.

Cash flow from operating activities Cash received from customers 1788876 Cash paid for goods and services -881956 Cash paid for operating expenses -243320 Cash paid for interest -70784 Cash paid for taxes -312840 Net cash flow from operating activities 279976 Cash flow from investing activities Cash received from sale of building 624416 Cash paid to purchase equipment -357712 Net cash flow from investing activities 266704 Cash flow from financing activities Cash used to purchase treasury stock -151996 Cash dividends paid -68888 Cash received from issuing common stock 1121800 Cash paid to redeem bonds at maturity -632000 Net cash flow from financing activities 268916 Net cash flow 815596 Beginning cash 34760 Ending cash 850356

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