PROBLEM 4, 20 points Data for Orange Company is shown betow Using the indirect m

Question

PROBLEM 4, 20 points Data for Orange Company is shown betow Using the indirect method, prepare only tho operating actvitios section of the statement of cash flows for Orange Co for the year ended December 31, 2018 Schedufe paper is attached. Orangs Co December 31, 2018 2018 2017 Assets $24.840 23 040 Cash 32,180 73.125 55.900 175,500 29.400 61,710 56.400 145,500 Long-term Investments Equipment Accumulated Depreciation Total Assets Liabilities: Accounts Payable Income Taxes Payable Bonds Payable $85.00o 10.725 $40.380 10 200 Total Liabilities 124.475 Equity Common Stock Contributed Capital Retained Earnings 117,000 13,000 96,000 9.000 Total Equity Total Liabilities and Equity Orange Co Income Statement For Year Ended December 31, 2018 ales ost of Goods Sold epreciation Expense ther Operating Expenses tal Expenses ss on Sale of Equipment ome Before Taxes ome Tax Expense Income $80,900 29 400 50.000 160 300) S 400) 7t.300 Swanson Page 8 of 9 WLEM 3, 18 poins Kramer Corpoan h

Explanation / Answer

Solution - Cash Flow From Operating Activities

Note 1 -

Ledger on Income Tax Expenses

Particulars Amount Net Income $43650 +/- Non Cash Items- + Depreciation $29400 + Loss on sale of Equipment $8400 $37800 Net Income Before working capital changes $81450 +/-Working Capital Changes - - Increase in Accounts Receivable ($2780) - Increase in Inventory ($11415) + Increase in Accounts Payable $24620 $10425 Cash Flow from Operating Activities before Income Taxes $91875 Less - Tax Paid (Note 1) ($27125) Cash Flow From Operating Activities $64750

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