The following information was extracted from the accounting records of Ocean Adv
ID: 2482031 • Letter: T
Question
The following information was extracted from the accounting records of Ocean Adventures, Inc.:
a. Net income, $46,200
b. Depreciation on equipment, $3,400
c. Purchased long-term investments, $6,900
d. Sold land for $46,900 (amount includes a loss of $8,700)
e. Issued long-term note payable to acquire equipment, $12,300
f. Payment on long-term note payable, $41,000
g. Issued common stock for cash, $4,900
h. Declared and paid cash dividend, $28,100
Increases (decreases) in selected accounts were as follows:
Accounts receivable (2,400)
Interest receivable (700)
Inventory 8,400
Prepaid expenses 900
Accounts payable 2,100
Income tax payable (700)
Accrued liabilities (1,500)
Interest payable 800 Salaries payable (1,700)
Beginning cash was $52,500.
Prepare the statement of cash flows for Ocean Adventures for the year ended December 31, 2006, using the indirect method and including a schedule of noncash investing and financing activities, if necessary.
Explanation / Answer
Answer:
Ocean Adventures Statement of cash Flows Cash Flow from operating activities Net income 46200 Adjustments: Depreciation 3400 Loss on sale of land 8700 Dec in accounts receivable 2400 Dec in interest receivable 700 Increase in inventory -8400 Increase in prepaid exp -900 Increase in accounts payable 2100 Dec in income tax payable -700 Dec in accrued liabilities -1500 Increase in interest payable 800 Decrease in salaries payable -1700 Net cash Flow provided by operating activities 51100 Cash Flow from investing activities: Purchased long-term investments -6900 Sale of land 46900 Net cash Flow provided by investing activities 40000 Cash Flow from financing activities: Payment on long-term note payable -41000 Issued common stock for cash 4900 Dividend Paid -28100 Net cash flow used in financing activities -64200 Net change in cash 26900 Beg cash 52500 Closing cash 79400Related Questions
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