The following changes took place last year in Pavolik Company\'s balance sheet a

Question

The following changes took place last year in Pavolik Company's balance sheet accounts: Liabilities and Stockholders Equity Accounts Asset and Contra-Asset Accounts Cash Accounts receivable Inventory Prepaid expenses Long-term investments Property, plant, and equipment Accumulated depreciation 25 D Accounts payable 29I Accrued liabilities 68 D Income taxes payable 24I Bonds payable $ 26 D Common stock $470 I Retained earnings $ 97 I $ 77 I $ 29 D $ 34 I $244 I $116 D $ 97 I D = Decrease: I = Increase Long-term investments that cost the company $26 were sold during the year for $56 and land that cost $55 was sold for $29. In addition, the company declared and paid $23 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place during the year. Pavolik did not retire any bonds during the year or issue any new common stock. The company's income statement for the year follows: Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items: $1,170 516 654 470 184 $(26) 30 Loss on sale of land Gain on sale of investments Income before taxes Income taxes Net income 188 68 $ 120 The company's beginning cash balance was $138 and its ending balance was $113.

Explanation / Answer

Answer:-

Pavolik Company Statement of Cash Flow (Using Indirect Method) For the year ended   Particulars Amount $ Cash flow from opreating activities Net Income 120 Adjustments to reconcile net income to net cash provided by opreating activities Adjustment for non cash effects Depreciation 97 Loss on disposal of land 26 Gain on sale of investments -30 Change in opreating assets & liabilities Increase in accounts receivable -29 Decrease in inventory 68 Increase in prepaid expenses -24 Increase in accounts payable 77 Decrease in Accrued liabilities -29 Increase in income taxes payable 34 Net cash flow from opreating activities (a) 310

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.