Condensed financial data of Fulton Corp. for 2017 and 2016 are presented below.
ID: 2574364 • Letter: C
Question
Condensed financial data of Fulton Corp. for 2017 and 2016 are presented below.
FULTON CORP COMPARATIVE BALANCE SHEET As OF DECEMBER 31 2016 $ 600 2,100 2017 $ 800 Receivables 1,600 1,600 $5,650 750 (455) $4,845 $1,200 Accounts payable Accrued liabilities Capital stock 1,500 1,400 $4,845 FULTON CORP INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017 Cost of goods sold Gross margin Selling and administrative expense1205 Income from operations Other revenues and gains Loss on sale of investments Income before income tax x expense Cash dividends Income retained in business 1,545 Additional information: During the year, $100 of common stock was issued in exchange for land. No plant assets were sold in 2017. Prepare a statement of cash flows using the indirect method.Explanation / Answer
FULTON CORP Cash Flow Statement For year ended 31 December 2017 Cash flows from operating activities Net Income $ 2,145 Adjustment to reconcile net income to: Depreciation expense $ 145 $600-$455 Changes in current operating assets and liabilities Increase in accounts receivable $ (150) increase in inventory $ (400) Decrease in accounts payable $ (450) Decrease in accrued liabilities $ (190) $ (1,045) Net cash provided by operating activities $ 1,100 Cash flows from investing activities Proceeds from sale of Investments $ 200 Purchase of plant assets $ (300) Net cash used by investing activities $ (100) Cash flows from financing activities Bond repayment $ (200) Dividend paid $ (600) Net cash used by financing activities $ (800) Net increase in cash and cash equivalents $ 200 Cash and cash equivalents at beginning of period $ 600 Cash and cash equivalents at end of period $ 800 Non cash investing and financing activities Issue of common stock for land $ 100
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