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 $14,200 21,700 20,200 69,800 $10,500 23,500 26,500 69,800 (15,200) 11,000) Total $110,700 $119,300 Accounts payable Common stock Retained earnings $11,800 75,200 23,700 $110,700 $28,600 71,200 19,500 $119,300 Total Additional information: 1. Net income was $22,200. Dividends declared and paid were $18,000 2. No noncash investing and financing activities occurred during 2017 3. The land was sold for cash of $4,700 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).)

Explanation / Answer

Statement of Cash Flows

Cash flows from operating activities

ROJAS CORPORATION

Statement of Cash Flows

for the year ended 12/31 2017

Cash flows from operating activities

Net income $22,200 Adjustments for: Depreciation and amortization 15200-11000 $4,200 Decrease in account receivables 23500-21700 $      1,800 Decrease in account payables 28600-11800 -16,800 loss on sale of land 26500-20200=6300 cost less4700 1,600 -9,200 Cash generated from operations 13,000 Cash flows from investing activities Proceeds from sale of land 4,700 4700 Net cash generated in investing activities 4,700 Cash flows from financing activities Proceeds from issue of common stock 75200-71200 4,000 Dividends paid -18,000 -14,000 Net cash used in financing activities -14,000 Net increase in cash and cash equivalents 3,700 Cash and cash equivalents at beginning of period 10,500 Cash and cash equivalents at end of period $14,200

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