ACT506 Portfolio Project Option#2 Push Corporation and Subsidiaries Consolidated

Question

ACT506 Portfolio Project Option#2 Push Corporation and Subsidiaries Consolidated Statement of Cash Flows For the Year Ended December 31, 20x7 (Indirect Method) Additional Information Information for Cash Flow Statement completion A. Push Corporation has 100% control of Summer Corporation on 01/02/20x7. Push Consolidated Income Statement B. Push Corporation has $195,000 Consolidated Income for 20x7. 12/31/20x7 12/31/20x7 C. Push Corporation pays a $10,000 Dividend to stockholders. D. Summer Corporation reports income of $100,000 and pays Dividend of $50,000 in 20x7. Revenue 950,000 E. Push Corporation sells land that it purchased in 20X1 for $50,000 to nonaffiliated for $100,000. Gain on Sale of Land 50,000 F. Summer Corporation purchases additional equipment for 200,000 at end of 20x7. Loss on Sale of Equipment -5,000 G. Parent, Push Corporation purchases Additional Equipment for $150,000 on June 01, 20x7. Cost of Goods Sold 500,000 H. Common Stock of $10.00 par was issued with 10,000 shares for $100,000 value on Mar, 01 20x7. Depreciation Expense 100,000 I. Long Term Bonds were retired at fair market value with cash on Jan 15, 20x7, $150,000. Other Expenses 200,000 K. Land with a book value of $25,000 was sold for $20,000, a loss of $5,000. Total expenses 800,000 L. Increase in Cash and Increase or decrease in cash balance. Done after all entries performed. M. Account Receivable increased $100,000. Consolidated Income 195,000 N. Inventory increased $100,000. Parent's Equity income from Subsidiary 100,000 O. Increase in Accts Payable $100,000. Subsidiary Net Income 20x6 -100,000 P. Accumulated Depreciation increased $100,000. Consolidated Net Income 195,000 Q. Goodwill did not change in year. R. Paid In Capital did not change in year. B. Retained Earnings Statement Note: No Item J=intentionally omitted Parent's beginning R.E from operations Parent's Income from operations Parent's Dividend to stockholders Consolidated Retained Earnings Push Corporation Balance Sheet Dates 12/31/20x6 Cash 150,000 Acct Rec 200,000 Inventories 150,000 Land 25,000 Land 100,000 Buildings and Equipment 500,000 Goodwill 100,000 Total Debits 1,225,000 Acc Depreciation 200,000 Accts Payable 50,000 Bonds Payable 150,000 Common Stock 200,000 Paid in Capital 125,000 Retained Earnings 500,000 1,225,000

Explanation / Answer

Push Corporation and Subsidiaries Consolidated Statement of Cash Flows For the Year Ended December 31, 20x7 $ $ I Cash flow from Operating Activities: 1,485,000 Net Income (195,000 + 950,000) 1,145,000 ADD : Loss on sale of Fixed assets (land and equipment ) (50,000 +5,000 +5,000) 60,000 Depreciation 100,000 Dividend paid (10,000 + 50,000) 60,000 Less : Profit on sale of land -50,000 170,000 1,485,000 II Cash flow from Investing Activities : -230,000 Sale proceeds on sale of land 120,000 Purchase of equipment (150,000 +200,000) -350,000 -230,000 III Cash flow from Financing Activities : -110,000 Common stock issued 100,000 Redemption on bond -150,000 Dividend paid -60,000 -110,000 IV Net Increase in Cash and Cash equivilants 1,145,000 V Cash and Cash equivalants at the BOY 150,000 VI Cash and Cash equivalants at the EOY ( IV +V) 1,295,000

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