Answer the following questions based on the year end financial statement. Task #

Question

Answer the following questions based on the year end financial statement.

Task #1-Cash Flow: GRI currently wants to increase their bank financing and in order to do so they are being required by the bank to provide more accurate financial statements. The bank is requiring that GRI prepare the following financial statements .Statement of Income - Multi-Step format .Statement of Financial Position Statement of Changes in Equity . Statement of Cash Flow Using the information provided please prepare the above-required financial statements for year-ending Dec 31, 2018.

Explanation / Answer

Statement of Income Multi-step format Gold sales 4500 Less:Mineral rights 900           Fuel 800 1700 Gross Margin 2800 Less: Operating expenses: Repairs& Maintenance 140 Salaries& wages 1350 Administrative & interest expenses 50 Depreciation expense 900 Travel expense 90 Capital gain on sale of an asset -8 2522 Operating income 278 Less: Non-operating (exp.)/Income: Interest income 10 Dividend income 5 15 Income before tax 293 Less: Income taxes 70 Income after-tax 223 Statement of Financial Position Assets Current Assets Cash 543 Accounts Receivable 500 Prepaid-Fuel 80 Total Current assets 1123 Fixed assets PP&E-Equipment 4000 Less: Accumulated depreciation-PP&E-Equipment 3200 Net fixed assets 800 Investments 30 Total assets 1953 Liabilities & Equity Liabilities Current liabilities Accounts payable 200 Salaries payable 80 Bank loan -payable in 2019 180 Total current liabilities 460 Long-term liabilities Bank loan -payable in 2024 320 Total liabilities 780 Stockholders' Equity Common shares 100 Retained Earnings 1073 Total Stockholders' Equity 1173 Total Liabilities & Equity 1953 Statement of Changes in Equity Beginning balance of total equity(100+1350) 1450 Add:2018 net income 223 Less: Dividends paid 500 Closing balance of total equity 1173 Statement of Cash flows Operating activities Net income as per income statement 223 Adjustments for non-cash items: Add:Depreciation 900 Less: Capital gain on sale of asset -8 892 Adjusted Net Income 1115 Changes to Working capital Add: Decrease in Accounts receivables(600-500) 100 Add: Decrease in Pre-paid fuel(110-80) 20 Less: Decrease in accounts payable(300-200) -100 Less: Decrease in salaries payable(110-80) -20 Net change to Working Capital 0 Cash generated from operating activity 1115 Investing activities Sale proceeds of PP&E 30 Sale proceeds of Investments(35-30) 5 Cash generated from investing activities 35 Financing activities Issue of new shares 10 Repayment of loan -160 Payment of dividends -500 Cash generated from financing activities -650 Net cash used 500 Add:Beginning cash balance 43 Ending cash balance as on Dec 31, 2018 543

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.