Exercise 13-7 (Part Level Submission) Rojas Corporation\'s comparative balance s

Question

Exercise 13-7 (Part Level Submission) Rojas Corporation's comparative balance sheets are presented below ROJAS CORPORATION Comparative Balance Sheets December 31 2017 2016 Cash Accounts receivable Land Buildings Accumulated depreciation-buildings $14,500 21,500 20,200 70,000 $10,600 23,200 25,700 70,000 (15,500) (10,500) Total $110,700 $119,000 Accounts payable Common stock Retained earnings $12,700 76,000 22,000 $110,700 $27,600 72,700 18,700 $119,000 Total Additional information: 1. Net income was $23,000. Dividends declared and paid were $19,700 2. No noncash investing and financing activities occurred during 2017 3. The land was sold for cash of $4,400 Prepare a statement of cash flows for 2017 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).) ROJAS CORPORATION

Explanation / Answer

ROJAS CORPORATION Statement of Cashflows For the year Ended December 31, 2017 Cash flows from operating activities Net Income $   23,000 Adjustments to reconcile net income to : Depreciation expense $      5,000 15500-10500 Loss on sale of land $      1,100 25700-20200-4400 Decrease in accounts receivable $      1,700 23200-21500 Decrease in accounts payable $ (14,900) 12700-27600 $   (7,100) Net cash flow from operating activities $   15,900 Cash flows from investing activities Cash received from sale of land $      4,400 Net cash provided by investing activities $      4,400 Cash flows from financing activities Cash paid for dividend $ (19,700) Cash received from issue of shares $      3,300 76000-72700 Net cash flow used by financing activities $ (16,400) Net increase in cash and cash equivalents $      3,900 Cash and cash equivalents at beginning of period $   10,600 Cash and cash equivalents at end of period $   14,500

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