CONDENSED FINANCIAL DATA OF SINJH INC. FOLLOW: Sinjh Inc. Comparative Balance Sh
ID: 2382086 • Letter: C
Question
CONDENSED FINANCIAL DATA OF SINJH INC. FOLLOW:
Sinjh Inc.
Comparative Balance Sheets
Decemeber 31
Assets 2014 2013
Cash $100,350 $48,400
Accounts recievable 92,800 33,000
Inventory 112,500 102,850
Prepaid Expenses 29,300 26,000
Longterm investments 140,000 114,000
Plant assets 265,000 242,500
Accumulated Depreciation (47,000) (52,000)
Total $692,950 $514,750
Liabilities and Stockholders' Equity
Accounts Payable $112,000 $67,300
Accured expenses payable 16,500 17,000
Bonds Payable 110,000 150,000
Common Stock 220,000 175,000
Retained Earnings 234,450 105,450
Total $ 692,950 $514,750
Sinjh Inc.
Income Statement
For the Year Ended Decemeber 31,2014
Sales $392,780
Gain on disposal of Plant Assets 5,000 $397,780
Less:
Cost of Goods Sold 135,460
Operating Expenses, excluding Deprecation 13,410
Deprecation Expense 45,000
Income Taxes 27,280
Interest Exense 4,730 224,880
Net Income $172,900
Additional Information:
1. New Plant assets costing $80,000 were purchased for cash during the year
2. Old plant assets having an original cost of $57,500 and accumulated depreciation of $50,000 were sold for $12,500 cash.
3. Bonds payable matured and were paid off at face value for cash.
4. A cash dividend of $43,900 was declared and paid during the year.
Instructions:
PREPARE A STATEMENT OF CASH FLOWS USING THE INDIRECT METHOD.
Explanation / Answer
Hi,
Please find the answer as follows:
Thanks.
172900 Add Depreciation 45000
Increase in Accounts Payable (112000 - 67300) 44700
Less Increase in Accounts Receivable (33000 - 92800) -59800
Increase in Inventory (102850 - 112500) -9650
Increase in Prepaid Expenses (26000 - 29300) -3300
Decrease in Accrued Expenses Payable (16500 - 17000) -500
Gain on Sale of Plant (57500 - 50000 - 12500) -5000
Total Adjustments 11450 11450 Net Cash Flow from Operating Activities (1)
184350
Cash Flow from Investing Activities
Purchase of Plant
-80000 Sale of Plant
12500 Purchase of Investments
-26000 Net Cash Flow from Investing Activities (2)
-93500
Cash Flow from Financing Activities
Redemption of Bonds
-40000 Issuance of Common Stock (220000 - 175000)
45000 Cash Dividends Paid
-43900 Net Cash Flow from Financing Activities (3)
-38900
Increase in Cash Balance (1+2+3)
51950 Add Opening Cash Balance
48400 Closing Cash Balance
100350
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