Required: Prepare, in good form, a Statement of Cash Flows using the indirect me
ID: 2559889 • Letter: R
Question
Required: Prepare, in good form, a Statement of Cash Flows using the indirect method. Dingel Dorf Company Income Statement For the year ended December 31, 2016 Net Sales Cost of Goods Sold Gross Profit Operating Expenses Income from Operations Other Revenue and Expenses: $950,000 600,000 $350,000 250,000 $100,000 $15,000 3,000 Gain on sale of investments Loss on disposal of equipment Total Other Revenue and Expenses Income Before Income Taxes Income Tax Expense Net Income Additional Information: During the current vear the following transactions occurred A. Equipment that cost $10,000 and was 60% depreciated was sold and cash was received. B. Cash dividends were declared and paid. C.Common Stock was issued in exchange for Land. D. Investments that cost $35,000 were sold. 12,000 $112,000 45,000 $67,000 08/14/2017Explanation / Answer
Dingel Dorf Company
CASH FLOW STATEMENT FOR THE YEAR ENDED DEC 31,2016
$
$
CASH FLOW FROM OPERATING ACTIVITIES
Net Profit /Operating Profit Before Tax &Working Capital Changes
67,000.00
Adjustment For non cash items and working capital changes:
Gain on sale on investments
(15,000.00)
Loss on disposal of equipment
3,000.00
Depreciation (9000+7000)
16,000.00
Accounts receivable (145000 - 122000)
(23,000.00)
Merchandise Ineventory (75000 - 61000)
(14,000.00)
Accounts payable (66000 - 60000)
6,000.00
Income tax payable (12000 - 10000)
2,000.00
NET CASH FROM OPERATING ACTIVITIES (A)
42,000.00
CASH FLOW FROM INVESTING ACTIVITIES
Sale of equipment (4000-3000)
1,000.00
Purchase of equipment (70000 - 44000)
(26,000.00)
Sale of investments (35000+15000)
50,000.00
Purchase of investments (85000-35000-55000)
(5,000.00)
NET CASH FROM INVESTING ACTIVITIES (B)
20,000.00
CASH FLOW FROM FINANCING ACTIVITIES
Issue of common stock [(310000-260000)-(40000-25000)]
35,000.00
Payment of Notes (70000 -62000)
(8,000.00)
Payment of dividend (95000+67000-92000)
(70,000.00)
NET CASH FROM FINANCING ACTIVITIES (C)
(43,000.00)
NET CHANGES IN CASH AND CASH EQUIVALENTS (A+B+C)
19,000.00
ADD: OPENING CASH AND CASH EQUIVALENTS
51,000.00
CLOSING CASH AND CASH EQUIVALENTS
70,000.00
Dingel Dorf Company
CASH FLOW STATEMENT FOR THE YEAR ENDED DEC 31,2016
$
$
CASH FLOW FROM OPERATING ACTIVITIES
Net Profit /Operating Profit Before Tax &Working Capital Changes
67,000.00
Adjustment For non cash items and working capital changes:
Gain on sale on investments
(15,000.00)
Loss on disposal of equipment
3,000.00
Depreciation (9000+7000)
16,000.00
Accounts receivable (145000 - 122000)
(23,000.00)
Merchandise Ineventory (75000 - 61000)
(14,000.00)
Accounts payable (66000 - 60000)
6,000.00
Income tax payable (12000 - 10000)
2,000.00
NET CASH FROM OPERATING ACTIVITIES (A)
42,000.00
CASH FLOW FROM INVESTING ACTIVITIES
Sale of equipment (4000-3000)
1,000.00
Purchase of equipment (70000 - 44000)
(26,000.00)
Sale of investments (35000+15000)
50,000.00
Purchase of investments (85000-35000-55000)
(5,000.00)
NET CASH FROM INVESTING ACTIVITIES (B)
20,000.00
CASH FLOW FROM FINANCING ACTIVITIES
Issue of common stock [(310000-260000)-(40000-25000)]
35,000.00
Payment of Notes (70000 -62000)
(8,000.00)
Payment of dividend (95000+67000-92000)
(70,000.00)
NET CASH FROM FINANCING ACTIVITIES (C)
(43,000.00)
NET CHANGES IN CASH AND CASH EQUIVALENTS (A+B+C)
19,000.00
ADD: OPENING CASH AND CASH EQUIVALENTS
51,000.00
CLOSING CASH AND CASH EQUIVALENTS
70,000.00
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