Please prepare cash flow for every year based on the information provided: Aliso

Question

Please prepare cash flow for every year based on the information provided:

Alison the Architect Income statement for the years ended December 31 20X1 20X2 20x3 Sales $127,970 $152,280 $201,000 Salary expenses 37,440 40,440 44,520 Rent expenses 14,400 15,600 17,160 Phone expenses 4,560 4,920 5,400 Office supplies expenses 4,670 5,400 8,040 Utilities expenses 186,000 20,040 22,080 Insurance expenses 9,300 10,151 11,590 Kitchen supplies expenses 8,490 7,480 7,670 Professional service expenses 1,300 1,840 1,730 Depreciation expenses 7,812 9,565 10,879 Pretax income 21,398 36,844 71,931 Tax expenses 8,559 14,738 28,772 Net income $12,839 $22,106 $43,159 Earning per share $0.19 $0.32 $0.64 Alison the Architect Statement of Owner's Equity Common Additional Retained Earnings Total for the years ended December 31 Stock paid in capital January 1 20X0 $ $ $ $ Issuance of stock during 20X1 67,000 234,500 301,500 Net income for 20x1 12,839 12,839 Dividends declared in 20X1 -5,360 -5,360 December 31, 20X1 67,000 234,500 7,479 308,979 Issuance of stock during 20x2 Net income for 20x2 22,106 22,106 Dividends declared 20x2 -4,020 -4,020 December 31,20x2 67,000 234,500 25,565 327,065 Issuance of stock during 20x3 Net income for 20x3 43,159 43,159 Dividend declared 20x3 -12,060 -12,060 December 31,20x3 $67,000 $234,500 $56,664 $358,164

Explanation / Answer

particulars 2011 2012 2013

cash flow from operating activities

cash received from customers 111250 169000 201000

cash paid for expenses (96680) (107921) (118190)

tax expenses (3240) (20057) (28772)

prepaid insurance (2280) - -

net cashflow from operating

activities 9050 31701 54038

cash flow from investing activities

cash paid for automobile (34500) - -

office supplies (1170) - -

kitchen supplies (260) - -

copiers (2910) - -

cash flow from investing activities (38840) - -

cash flow from financing activities

issuance of common stock 67000 - -

additional capital 234500 - -

dividend paid (4020) (5360) (12060)

cash flow from financing activities 297480 (5360) (12060)

total increase/decrease in cashflow 267690 26341 41978

opening cash - 267690 294031

TOTAL CASHFLOW 267690 294031 336009

note:-

1. depreciation is a non cash item hence not to be considered in cash flows.

2. in cash paid for expenses the items considered are salary, rent, phone , office supplies , utilities, kitchen supplies and professional services expenses.

3. from 2011 it is assumed and taken as account payable; taxes; dividend payable paid in 2012 and receivables received in 2012 of 2011. the same was reflected in cashflow statements.

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