Here are comparative balance sheets for Doherty Company. Doherty Company Compara
ID: 2503248 • Letter: H
Question
Here are comparative balance sheets for Doherty Company.
Doherty Company
Comparative Balance Sheets
December 31, 2013
Assets
2013
2012
Cash
$ 33,000
$10,000
Accounts receivable
18,000
14,000
Inventories
25,000
18,000
Prepaid expenses
6,000
9,000
Long-term investments
0
18,000
Equipment
60,000
32,000
Accumulated depreciation
Doherty Company
Comparative Balance Sheets
December 31, 2013
Assets
2013
2012
Cash
$ 33,000
$10,000
Accounts receivable
18,000
14,000
Inventories
25,000
18,000
Prepaid expenses
6,000
9,000
Long-term investments
0
18,000
Equipment
60,000
32,000
Accumulated depreciation
Explanation / Answer
CASH FLOW FROM OPERATING ACTIVITIES
NET INCOME FOR THE YEAR
33000
ADD:-DEPRECIATION
6000
ADD:-LOSS ON SALE OF INVESTMENT
4000
CASHINFLOW FROM OPERATING ACTIVITIES BEFORE ADJUSTMENT FOR WORKING CAPIATAL CHANGES
43000
ADJUSTMENT FOR WORKING CAPITAL CHANGES:-
LESS:-INCREASE IN ACCOUNTS RECIEVABLE
(4000)
LESS:-INCREASE IN INVENTORY
(7000)
ADD:-DECREASE IN PREPAID EXPENSE
3000
ADD:-INCREASE IN ACCOUNTS PAYABLE
10000
CASHINFLOW FROM OPERATING ACTIVITIES
45000
CASHFLOW FROM INVESTING ACTIVITIES
SALE OF LONG TERM INVESTMENT
14000
PURCHASE OF EQUIPMENT
(28000)
CASHOUTFLOW FROM INVESTING ACTIVITIES
(14000)
CASH FLOW FORM FINANCING ACTIVITIES
CASH DIVIDEND PAID
(15000)
ISSUE OF COMMON STOCK
17000
REDEMPTION OF BONDS
(10000)
CASHOUTFLOW FROM FINANCING ACTIVITIES
(8000)
NET CASHINFLOW DURING THE YEAR [45000-14000-8000]
23000
ADD:-OPENING CASH BALANCE DURING THE YEAR
10000
CLOSING CASH BALANCE DURING THE YEAR
33000
CASH FLOW FROM OPERATING ACTIVITIES
NET INCOME FOR THE YEAR
33000
ADD:-DEPRECIATION
6000
ADD:-LOSS ON SALE OF INVESTMENT
4000
CASHINFLOW FROM OPERATING ACTIVITIES BEFORE ADJUSTMENT FOR WORKING CAPIATAL CHANGES
43000
ADJUSTMENT FOR WORKING CAPITAL CHANGES:-
LESS:-INCREASE IN ACCOUNTS RECIEVABLE
(4000)
LESS:-INCREASE IN INVENTORY
(7000)
ADD:-DECREASE IN PREPAID EXPENSE
3000
ADD:-INCREASE IN ACCOUNTS PAYABLE
10000
CASHINFLOW FROM OPERATING ACTIVITIES
45000
CASHFLOW FROM INVESTING ACTIVITIES
SALE OF LONG TERM INVESTMENT
14000
PURCHASE OF EQUIPMENT
(28000)
CASHOUTFLOW FROM INVESTING ACTIVITIES
(14000)
CASH FLOW FORM FINANCING ACTIVITIES
CASH DIVIDEND PAID
(15000)
ISSUE OF COMMON STOCK
17000
REDEMPTION OF BONDS
(10000)
CASHOUTFLOW FROM FINANCING ACTIVITIES
(8000)
NET CASHINFLOW DURING THE YEAR [45000-14000-8000]
23000
ADD:-OPENING CASH BALANCE DURING THE YEAR
10000
CLOSING CASH BALANCE DURING THE YEAR
33000
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