Additional information from accounting records: a. Land that originally cost $9,

Question

Additional information from accounting records:

a.       Land that originally cost $9,000 was sold for $6,000

b.      The common stock of news corp was purchased for $35,000 as a long-term investment

c.       New equipment was purchased for $150,000 cash

d.      A $30,000 note was paid at maturity on January 1

e.      On January 1, 2018, $60,000 of bonds were sold at face value

f.        Common stock ($50,000 par) was sold for $76,000

g.       In may, Jamaica Inc issued a 5% stock dividend (5,000 shares). The market price of $1 par value common stock was $8 per share at that time

h.      Net income was $80,000 and cash dividends of $35,000 were paid to shareholders

Cash paid to suppliers?

$118,00

$132,000

$122,000

$142,000

Net cash Investing?

($181,000)

($168,000)

($144,000)

($169,000)

Net Cash Financing?

$31,000

$101,000

$71,000

$106,000

Net Cash Operating Activities?

20172016 Income Statement for 201 Cash Accounts Receivable Inventory Long-term investment Building and Equipment Accumulated Depreciation Land 380,000 (120,000)) (55,000) (40,000) (12,000) (3,000) 70,000 S 80,000 S 42 $ 31.000 Sales Revenue 73,000 75,000 40,000 550,000 (115.000) 50,000 75.000 Cost of Goods Sold 70,00011 Salaries Expense 15000 Depreciation Expense 400,000 Interest Expense (75,000)!! Loss on Sale of Land 59,000 Income Tax Expense Total Assets Net Income S 715,000 $ 575,000 Liabilities and Stockholder's Equity Accounts Payable Salaries Payable Interest Payable Income Tax Payable Notes Payable Bonds Payable $ 28,000 35,000 2,000 5,000 9,000 5,000 3,000 12,000 30,000 160,000100000 Total Liabilities S 204.000 185,000 Stockholder's Equity Common Stock, $1 par 255,000 200,000 Paid-in Capital Excess of par Retained Eamings 161,000 95,000 100,000 90.000 Total Stockholder's Equity Total Liabilities and Stockholder's Equity S 511,000 390,000 S 715,000 575,000

Explanation / Answer

Cash Flow statement-Direct Method Working Note For the Year Ended December 31, 2017 1 Cash received from customers: Cash flows from operating activities $(in 000) $(in 000) Opening Accounts recevable 75000 Cash received from customers 1 $ 382,000 Add: sales 380000 Cash paid to suppliers 2 (132,000) 455000 Cash paid for operating expenses 3 (141,000) Less: Ending Accounts Receivable -73000 Net cash provided (used) by operating activities $ 109,000 Cash received from customers 382000 Cash flows from investinq activities Sale of land             6,000 2 Cash paid to suppliers: Sale of investment           10,000 (15000+35000-40000) Opening Accounts payable 35000 Purchase of investment         (35,000) Add: cost of goods sold 120000 Purchase of equipment       (150,000) Given Add: increase in inventory 5000 Net cash provided (used) by investing activities (169,000) 160000 Cash flows from financing activities Less: Ending Accounts Payable -28000 Redemption of note         (30,000) Cash paid to suppliers 132000 Issue of bonds           60,000 Issue of common stock           76,000 Given 3 Cash paid for operating expenses: dividend paid         (35,000) Given Opening accrued expenses payable 20000 (5000+3000+12000) Net cash provided (used) by financing activities       71,000 Add: operating expenses 137000 (55000+12000+70000) Net increase (decrease) in cash $   11,000 157000 Cash at beqinning of year       31,000 Less: Ending accrued expenses payable -16000 Cash at end of year $   42,000 Cash paid for operating expenses 141000 Cash paid to suppliers? $          132,000 Ans B Net cash Investing? $       (169,000) Ans D Net Cash Financing? $            71,000 Ans C Net Cash Operating Activities? $          109,000

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