e I https:// flow/connect.html 14 Homework As of December 31 Cash Accounts recei
ID: 2536805 • Letter: E
Question
e I https:// flow/connect.html 14 Homework As of December 31 Cash Accounts receivable Merchandise inventory Prepaid rent Equipment Accumulated depreciation Land $75,68e 40,99 28,588 28,864 155,847171,43 ,399 255,970 4,789 289,360 (136,330) (238,640) 191,968 $ 573,501 8,268 376,678 Total assets Liabilitses Accounts payable (inventory) Salaries payable s 64,893 24,290 73,618 28,828 Stockholders' equity Common stock, 558 par value Retained earnings 254,500208,5ee 81.740 229,818 Total liabilities and equity 573,5e s 376,678 Incone 5tatement For the Yeer Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses $1, 501,e6e0 (27 732) 703,268 Deprecistion expense Rent expense salaries expense Other operating expences (20,188 (23,610) (255,320) 255,98e 148,e78 Net incone Other Information 1. Purchased land for $111700 ?PreExplanation / Answer
Solution:
Cash Flow Statement
ZACHARY CORPORATION
Statement of Cash Flow (Indirect Method) For the Year Ended December 31, 2017
Cash Flow from Operating Activities:
$$
$$
Net Income
$148,078
Add: Decrease in current assets and Increase in current liabilities
+
Merchandise Inventory (171,430 - 155,847)
$15,583
+
Prepaid Rent (4780-2390)
$2,390
+
Salaries Payable (24,290 - 20,820)
$3,470
Less: Increase in Current Assets and Decrease in Current Liabilities
-
Accounts Receivable (28064 - 20580)
-$7,484
-
Accounts Payable (73,610 - 64,893)
-$8,717
Plus: Non Cash Charges
+
Depreciation Expenses
$20,180
Net Cash provided by Operative Activities
$173,500
Cash Flow from Investing Activities:
-
Purchase of Land
-$111,700
-
Purchase of New Equipment
-$100,500
+
Sale of Equipment
$19,400
Net Cash Used by Investing Activities
-$192,800
Cash Flow from Financing Activities:
+
Cash received from issuance of common stock
$54,000
Net Cash Provided by Financing Activities
$54,000
Net Increase/(Decrease) in Cash and Cash Equivalents
$34,700
Cash and Cash Equivalents at the beginning of the year
$40,900
Cash and Cash Equivalents at the end of the year
$75,600
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ZACHARY CORPORATION
Statement of Cash Flow (Indirect Method) For the Year Ended December 31, 2017
Cash Flow from Operating Activities:
$$
$$
Net Income
$148,078
Add: Decrease in current assets and Increase in current liabilities
+
Merchandise Inventory (171,430 - 155,847)
$15,583
+
Prepaid Rent (4780-2390)
$2,390
+
Salaries Payable (24,290 - 20,820)
$3,470
Less: Increase in Current Assets and Decrease in Current Liabilities
-
Accounts Receivable (28064 - 20580)
-$7,484
-
Accounts Payable (73,610 - 64,893)
-$8,717
Plus: Non Cash Charges
+
Depreciation Expenses
$20,180
Net Cash provided by Operative Activities
$173,500
Cash Flow from Investing Activities:
-
Purchase of Land
-$111,700
-
Purchase of New Equipment
-$100,500
+
Sale of Equipment
$19,400
Net Cash Used by Investing Activities
-$192,800
Cash Flow from Financing Activities:
+
Cash received from issuance of common stock
$54,000
Net Cash Provided by Financing Activities
$54,000
Net Increase/(Decrease) in Cash and Cash Equivalents
$34,700
Cash and Cash Equivalents at the beginning of the year
$40,900
Cash and Cash Equivalents at the end of the year
$75,600
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