Condensed financial data of Cheng Inc. follow. CIE NG INC. Comparative Balance S

Question

Condensed financial data of Cheng Inc. follow. CIE NG INC. Comparative Balance Sheets December 31 2016 2017 $80,800 $48,400 92,800 117,500 102,850 Assets Cash 33,000 Inventory Prepaid expenses Investments Equipment Accumulated depreciation-equipment 28,400 143,000 114,000 270,000 (50,000) (52,000) 26,000 242,500 Total $682,500 $514,750 Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Bonds payable Common stock Retained earnings $112,000 $67,300 16,500 17,000 110,000 150,000 220,000 175,000 224,000 105,450 $682,500 $514,750 Total CHENG INC. Income Statement For the Year Ended December 31, 2017

Explanation / Answer

Cash flow Statement: Cash flows form operating activities: Net income for the period: 158900 Adjustment required: Depreciation 46,500 Loss on disposal of plant 7,500 Increase in Accounts receivable -59,800 Increase in inventory -14,650 Increase in Prepaid expense -2,400 Increase in Accounts payable 44700 Decreas ein Accrued liabilities -500 21350 Net cash provided from operating activities 180250 cash flows from Investing activities: Purchase of equipment -85000 Sale of equipment 1500 Purchase of investment -29000 Net cash used in investing activities -112500 Cash flows from financing activities: Repayment of bonds payable -40000 Issue of common stock 45000 Dividend paid -40350 Net cash used in financing activities -35350 Net increase in cash 32400 Beginning balance of cash 48400 Ending balance of cash 80800

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