[The following information applies to the questions displayed below.] Golden Cor
ID: 2402101 • Letter: #
Question
[The following information applies to the questions displayed below.]
Golden Corp., a merchandiser, recently completed its 2017 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow.
Additional Information on Year 2017 Transactions
Net income was $152,000.
Accounts receivable increased.
Inventory increased.
Accounts payable increased.
Income taxes payable increased.
Depreciation expense was $54,000.
Purchased equipment for $52,900 cash.
Issued 13,000 shares at $5 cash per share.
Declared and paid $99,000 of cash dividends.
Required:
Prepare a complete statement of cash flows using a spreadsheet; report operating activities under the indirect method. (Enter all amounts as positive values.)
Comparative Balance Sheets
December 31, 2017 and 2016 2017 2016 Assets Cash $ 174,000 $ 118,000 Accounts receivable 98,000 81,000 Inventory 616,000 536,000 Total current assets 888,000 735,000 Equipment 361,900 309,000 Accum. depreciation—Equipment (163,000 ) (109,000 ) Total assets $ 1,086,900 $ 935,000 Liabilities and Equity Accounts payable $ 107,000 $ 81,000 Income taxes payable 38,000 30,100 Total current liabilities 145,000 111,100 Equity Common stock, $2 par value 612,000 578,000 Paid-in capital in excess of par value, common stock 206,000 175,000 Retained earnings 123,900 70,900 Total liabilities and equity $ 1,086,900 $ 935,000 Chapter 12 Problems Help Save & Exit Submit Saved 3 Check my work 5 Required information Analysis of Changes Debit Part 2 of 2 December 31, 2016 Credit December 31, 2017 Balance sheet-debit balance accounts Cash 118,000 81,000 536,000 309,000 1,044,000 174,000 Accounts receivable points Skipped Equipment 174,000 Balance shee credit balance accounts Accumulated depreciation-Equipment Accounts payable Income taxes payable Common stock, $2 par value Paid-in capital in excess of par value, common stock Retained earnings 109,000 81,000 30,100 578,000 175,000 70,900 1,044,000 eBook Print References Statement of cash flows Operating activities Graw Hill Prex 5 Of 5 Next>
Explanation / Answer
GOLDEN CORPORATION
Cash Flow Statement
December 31 2017
Cash Flow from Operating Activities:
Net Income
$ 152,000.00
Add: Adjustments
Depreciation expense
$ 54,000.00
Increase in Accounts Payables
$ 26,000.00
Increase in Accounts receivables
$ (17,000.00)
Increase in Inventory
$ (80,000.00)
Increase in Income tax payable
$ 7,900.00
$ (9,100.00)
A. Cash Flow from Operating Activities
$ 142,900.00
Cash Flow from Investing Activities:
Purchase of Equipment
$ (52,900.00)
B. Cash flow from Investing Activities
$ (52,900.00)
Cash Flow from Financing Activities:
Issue of Common Stock
$ 65,000.00
Dividend paid
$ (99,000.00)
C. Cash Flow from Financing Activities
$ (34,000.00)
Increase (Decrease) in cash [A+B+C]
$ 56,000.00
Add: cash at the beginning [2016 balance]
$ 118,000.00
Cash at the end [2017 Balance]
$ 174,000.00
GOLDEN CORPORATION
Cash Flow Statement
December 31 2017
Cash Flow from Operating Activities:
Net Income
$ 152,000.00
Add: Adjustments
Depreciation expense
$ 54,000.00
Increase in Accounts Payables
$ 26,000.00
Increase in Accounts receivables
$ (17,000.00)
Increase in Inventory
$ (80,000.00)
Increase in Income tax payable
$ 7,900.00
$ (9,100.00)
A. Cash Flow from Operating Activities
$ 142,900.00
Cash Flow from Investing Activities:
Purchase of Equipment
$ (52,900.00)
B. Cash flow from Investing Activities
$ (52,900.00)
Cash Flow from Financing Activities:
Issue of Common Stock
$ 65,000.00
Dividend paid
$ (99,000.00)
C. Cash Flow from Financing Activities
$ (34,000.00)
Increase (Decrease) in cash [A+B+C]
$ 56,000.00
Add: cash at the beginning [2016 balance]
$ 118,000.00
Cash at the end [2017 Balance]
$ 174,000.00
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