|You have completed the field work in connection with your audit of Dunder Corpo
ID: 2465338 • Letter: #
Question
|You have completed the field work in connection with your audit of Dunder Corporation for the year ended December 31, 2014. The balance sheet accounts at the beginning and end of the year are shown below: Cash Accounts Receivable Inventory Prepaid expenses Investment in subsidiary Cash surrender value of life insurance Land Buildings Equipment Patents Trademarks Bond discount and issue costs December 31, 2014 S99,435 $424,600 $635,740 $20,000 $200,000 $16,460 $100,000 $525,000 $381,000 $86,000 $25,000 $1,165 December 31, 2013 $110,700 $380,900 $576,475 $12,000 S0 $14,850 $100,000 $400,000 $290,000 $70,000 $35,000 $6,075 Total debits $2,514,400 $1,996,000 Accounts payable Income taxes payable Salaries and wages payable Allowance for doubtful accounts Accumulated depreciation - buildings Accumulated depreciation - equipment Long-term notes payable Bonds payable Premium on bonds payable Common stock Paid in capital in excess of par common stock Retained earnings $534,000 $68,000 $73,500 $25,000 $248,000 $160,000 $75,000 $400,000 $7,762 $150,000 $508,000 $34,500 $12,900 $23,000 $230,000 $103,000 $75,000 $300,000 S0 $125,000 $568,000 $205,138 $418,000 $166,600Explanation / Answer
Particulars Amount Cash from operating activity Profit after tax 38538 tax amount 33500.00 Profit before tax 72038.00 Changes in working capital adustments Add: Decrease in acc receiveble 11265.00 increase in acc payable 26000.00 increase in salaries payable 60600.00 Increase in doubtful allownace 2000.00 Less: increase in inventory -59265.00 Increase in cash surrender value -1610.00 increase in prepaid expense -8000.00 increase in investrment -200000.00 Net cash flow from operating activity -96972.00 Cash from investing activity Increase in building -125000.00 increase in equipment -91000.00 increase in patent -16000.00 decrease in trade marks -10000.00 Increase in acc dep 75000.00 Cash flow from investing activity -167000.00 Cash from financing activity Increase in funds increase in bonds 100000.00 Decrease in bond 4910.00 premium 7762.00 common stock 25000.00 paid in capital 150000.00 Cash flow from financing activity 287672.00 Total cash changes -11265.00 Cash at beginning of year 110700.00 Cash at end of the year 99435.00
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