G snack in ita G Organic De Employee-faci A Cash flows > + C D A ASSIGNMENT RESO
ID: 2520040 • Letter: G
Question
G snack in ita G Organic De Employee-faci A Cash flows > + C D A ASSIGNMENT RESOURCES Organic Developments Ltd. (ODL) is an importer of organic produce from California. The company has been experiencing significant growth and is preparing to approach the bank for a loan to acquire additional capital assets. As CFO, you are tasked with preparing the statement of cash flows that is required as part of the loan application. You have the statement of financial position and the statement of income to help you prepare the statement of cash flows. In addition you also have the following information: 1. 2. During the year, the company borrowed $11,760 by increasing its bank loan payable. In September, ODL sold equipment for $5,040 cash. The equipment had originally cost $112,560 and had a net carrying amount of $11,760 at the time of sale. In June, ODL acquired land with a value of $100,800 by issuing common shares with an equivalent value. The land is to be used as a site for a warehouse it hopes to construct in the next year. Assignment 4 for Marks Application Problem 5-9 (Part Level Submission) Application Problem 5-10 (Part Level Submission) Application Problem 11-8 (Part Level Submission Application Problem 11 12 (Part Level Submission) Application Problem 12-16 Review Score Review Results by Study Objective ORGANIC DEVELOPMENTS LTD. Statement of Financial Position As at October 31 Assets 2016 2015 Current assets: Cash $40,320 $30,240 Accounts receivable 48,720 57,120 Inventory 151,200 134,400 Total current assets 240,240 221,760 Equipment 520,800 453,600 Accumulated depreciation, equipment (252,000) (302,400) Land 100,800 $ 609,840 $ 372,960 Liabilities and Shareholders' Equity Current liabilities Accounts payable $ 68,880 $ 33,600 Dividends payable 25,200 30,240 Total current liabilities 94,080 63,840 Bank loan payable 62,160 100,800 POF EN 2: - * 10:31 a.m. 13/04/2018Explanation / Answer
Organic Developments Ltd. Statement of Cash Flow From Indirect method Year Ended October, 2016 Amount in $ Cash Flow from Operating Activities Net Income 201600 Add : Loss on Sale of equipment 6720 208320 Add : Depreciation 50400 258720 Effect of Working Capital Changes Less : Increase in Inventory -16800 Add : Increase in Account Payable 35280 Add : Decrease in Account Receivable 8400 Net Cash Flow from operating Activities (A) 285600 Cash Flow from Investing Activities Cash received from Sale of Equipment 5040 Cash paid for equipment (W.Note-1) -179760 Net Cash Used from Investing Activities (B) -174720 Cash Flow from Financing Activities Cash paid for dividends (W.Note-2) -62160 Cash received from bank Borrowings 11760 Cash Paid on Borrowings (W.Note-3) -50400 Net Cash Used from Financing Activities ( C ) -100800 Net increase (Decrease) in Cash (A+B+C0 10080 Cash balance beginning of the year 30240 Cash balance at end of the year 40320 Note-1 Cash paid for equipment Ending balance of Equipment 520800 add : Original cost of sale 112560 less : Opening Balance of Equipment -453600 179760 Note-2 Cash Paid for Dividends Beginning Dividend payable 30240 Add : Beginning Retained Earnings 57120 less : Ending Dividend Payable -25200 62160 Note-3 Cash Paid on Borrowings Beginning Loan payable 100800 Add : Loan during the year 11760 less : Ending Loan Payable -62160 50400
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