BERNARD COMPANY Comparative alance Sheet 31.2017, 2015 $60,000 76.000 93,000 100

Question

BERNARD COMPANY Comparative alance Sheet 31.2017, 2015 $60,000 76.000 93,000 100.000 200,000 $113,000 85.000 172,000 72.000 220,000 Accounts receivable Total assets 97.000 Accounts payable Bonds payable Common slock Retained eamings 240,000 300,000 Total labiltes and stockholders' equity 526.000 Net income for the year ending December 31, 2017 was $170,000 2. Land was sold at cost 3. Additional Equipment was purchased for $80,000 cash. Equipment, with a book value of $50,000, was sold for $48,000 during 2017 5 Bonds payable were redeemed for cash $80,000 6. Cash dividends of $35,000 were declared and paid during the year. . Several shanes of common stock were issued for a $10,000 Equipment TAKE HOME EXAM p. 6

Explanation / Answer

Cash flow indirect method Cash flow from operating activities Net income 170000 Adjustments to reconcile the net income Depreciation expense 54000 Loss on sale of equipment 2000 Changes in current asset and liabilities Increase in accounts receivable -9000 decrease in Inventory 21000 decrease in accounts payable -66000 2000 Cash flow from operating activities 172000 Cash flow from Investing activities Land sold 28000 Equipment sold 48000 Equipment purchased -80000 Cash flow from Investing activities -4000 Cash flow from Financing activities Paid in capital in excess Common stock Dividend -35000 Bonds payable -80000 Cash flow from Financing activities -115000 Net Cash and cash equivalent 53000 Add Beginning cash and cash equivalent 60000 Ending cash and cash equivalent 113000

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