Condensed financial data of Blossom Company follow Blossom Company Comparative B

Question

Condensed financial data of Blossom Company follow Blossom Company Comparative Balance Sheets December 31 2016 2017 193,920 210,720 270,000 Assets Cash Accounts receivable Inventory Prepaid expenses Long-term investments Plant assets Accumulated depreciation Total $ 116,160 91,200 246,840 62,400 261,600 582,000 68,160 331,200 684,000 (120,000)(124,800) $1,638,000 $1,235,400 Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Bonds payable Common stock Retained earnings Total $ 161,520 50,400 350,400 420,000 253,080 $1,638,000 $1,235,400 244,800 39,600 264,000 528,000 561,600 Blossom Company Income Statement Data For the Year Ended December 31, 2017 Sales revenue $932,304 Less Cost of goods sold Operating expenses, excluding depreciation Depreciation expense Income tax expense Interest expense Loss on disposal of plant assets $325,104 29,784 111,600 65,472 11,352 18,000 561,312 $ 370,992 Net income Additional information: 1. New plant assets costing $240,000 were purchased for cash during the year. 2. Old plant assets having an original cost of $138,000 and accumulated depreciation of $116,400 were sold for $3,600 caslh 3. Bonds payable matured and were paid off at face value for cash 4. A cash dividend of $62,472 was declared and paid during the year.

Explanation / Answer

STATEMENT OF CASHFLOWS Cashflows from Operating Activities: Net income during the year 370992 Adjustment required to rreconcile net income Depreciation expense 111600 Interest expense 11352 Loss on disposal of plant 18000 Increasse in accounts receivable -119520 Increase in inventory -23160 Increae in prepaid expense -5760 Increase in Accounts payable 83280 Decreasse in Accrued expense -10800 64992 Net cash provided from Operating activities 435984 Cashflows from Investing Activities: Plant Purchased -240000 sale of plant 3600 Purchase of Long term investmennt -69600 Net cash used in Investing Activities -306000 Cashflows from Financing Activities: Dividend paid -62472 Interest paid -11352 Bonds repayment -86400 Issue of comon Stock 108000 Net cash used in financing Activities -52224 Net cash inflow during the year 77760 Add: Beginning Cash and cash equivalents 116160 Ending Cash and cassh equivalents 193920

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