Jobim Inc., had the following condensed balance sheet at the end of operations f

Question

Jobim Inc., had the following condensed balance sheet at the end of operations for 2013. During 2014, the following occurred. A tract of land was purchased for $10,730. Bonds payable in the amount of $19,840 were retired at par. An additional $10,040 in capital stock was issued at par. Dividends totaling $9,326 were paid to stockholders. Net income was $30,050 after deducting depreciation of $13,770. Land was purchased through the issuance of $22,160 in bonds. Jobim Inc. sold part of its investment portfolio for $13,000. This transaction resulted in a gain of $2,070 for the company. The company classifies the investments as available-for-sale. Both current assets (other than cash) and current liabilities remained at the same amount. Prepare a statement of cash flows for 2014 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Explanation / Answer

JOBIN INC Statement of Cash Flows For the Years Ending December 31, 2014 2014 Cash Flows from Operating Activities Net Income $     30,050.00 Add Expenses Not Requiring Cash:     Depreciation $     13,770.00 Profit on sales of investment $      (2,070.00) Net Cash from Operating Activities $     41,750.00 Cash Flows from Investing Activities Purchase of New Land $    (10,730.00) Net Cash Used for Investing Activities $    (10,730.00) Cash Flows from Financing Activities $    (10,730.00) Increase in Capital Stock $   10,040.00 Payment of Bond Payable $    (19,840.00) Payment of Dividend $      (9,326.00) Net Cash from Financing Activities $    (19,126.00) NET INCREASE/(DECREASE) IN CASH $     11,894.00 CASH, BEGINNING OF YEAR $       8,300.00 CASH, END OF YEAR $     20,194.00

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