(2) Parti 38b 48. Balance sheet data and additional information for Anderson Ind
ID: 2591815 • Letter: #
Question
(2)
Parti
38b 48. Balance sheet data and additional information for Anderson Industries are given below for Anderson Industries 15 points
Partial Balance Sheet
December 31, 2016 and 2015
Assets
2016
2015
Cash ..........
$70,000
$10,000
Accounts receivable ....
80,000
92,000
Inventory ...
65,000
43,000
43,000
Liabilities
Accounts payable ...95,000 75,000
$75,000
Additional Information:
(a)
Net income for 2016 was $50,000.
(b)
Depreciation expense for 2016 was $25,000.
Prepare the operating activities section of the statement of cash flows, using the indirect method, for the year ending December 31, 2016.
Anderson Industries
Partial Statement of Cash Flows--Operating Activities
For the Year Ended December 31, 2016
Cash flows from operating activities:
Net income .................................
$ 50,000
Adjustments:
Depreciation ...........................
Decrease in accounts receivable ........
Increase in inventory ..................
Increase in accounts payable ...........
Net cash provided by operating activities ....
b. Assume equipment was purchased for 25,000 in 2016. Which section is this shown on the statement of cash flows and is it an increase or a decrease?
$ ,000
c. Assume Common Stock was sold for 125,000 in 2016. Which section is this shown on the statement of cash flows and is it an increase or a decrease?
Ass449. Clay Music Company was formed on December 1, 2016. The following information is available from Clayton's inventory records: 15 points
Units
Unit Cost
Balance at January 1, 2016 .......
4,800 @
$14.25
Purchases:
January 17, 2016 .............
9,000 @
15.00
December 7, 2016 ..........................
12,000 @
17.00
The company uses a periodic inventory system, and a physical inventory on Dec. 31, 2016, shows 9,600 units on hand.
How many units were sold in 2016?
Prepare a schedule to compute the ending inventory at December 31, 2016, under each of the following inventory methods:
(1)
FIFO _____Units * $ =
(2)
LIFO _____Units * $ =
(3)
Weighted Average _____Units * $ =
(2)
Parti
38b 48. Balance sheet data and additional information for Anderson Industries are given below for Anderson Industries 15 points
Partial Balance Sheet
December 31, 2016 and 2015
Assets
2016
2015
Cash ..........
$70,000
$10,000
Accounts receivable ....
80,000
92,000
Inventory ...
65,000
43,000
43,000
Liabilities
Accounts payable ...95,000 75,000
$75,000
Additional Information:
(a)
Net income for 2016 was $50,000.
(b)
Depreciation expense for 2016 was $25,000.
Prepare the operating activities section of the statement of cash flows, using the indirect method, for the year ending December 31, 2016.
Anderson Industries
Partial Statement of Cash Flows--Operating Activities
For the Year Ended December 31, 2016
Cash flows from operating activities:
Net income .................................
$ 50,000
Adjustments:
Depreciation ...........................
Decrease in accounts receivable ........
Increase in inventory ..................
Increase in accounts payable ...........
Net cash provided by operating activities ....
b. Assume equipment was purchased for 25,000 in 2016. Which section is this shown on the statement of cash flows and is it an increase or a decrease?
$ ,000
c. Assume Common Stock was sold for 125,000 in 2016. Which section is this shown on the statement of cash flows and is it an increase or a decrease?
Ass449. Clay Music Company was formed on December 1, 2016. The following information is available from Clayton's inventory records: 15 points
Units
Unit Cost
Balance at January 1, 2016 .......
4,800 @
$14.25
Purchases:
January 17, 2016 .............
9,000 @
15.00
December 7, 2016 ..........................
12,000 @
17.00
The company uses a periodic inventory system, and a physical inventory on Dec. 31, 2016, shows 9,600 units on hand.
How many units were sold in 2016?
Prepare a schedule to compute the ending inventory at December 31, 2016, under each of the following inventory methods:
(1)
FIFO _____Units * $ =
(2)
LIFO _____Units * $ =
Explanation / Answer
Answer for quesiton no.1:
Answer for question no,b:
The purchse of equipment is disclosed under cash from investing activities and is presented with a negative sign as this is cash outflow and decreases cash.
Answer for question no.c:
Issue of common stock is to be treated as a Financing activity and is presented with a positive number because this increases cash inflow.
Answer for question no.four:
Number of units sold= opening stock+purchases - closing stock
=4800+9000+12000 -9600
=16,200 units.
Value of inventory if FIFO mthod is used. It means first purchases are sold first, it means that the closing stock is from the latest purchases ie from purchases of 12000 units, therefore, its value would be 9600*17
=$163,200.
If LIFO method is used, it means the last purchases are sold first, so, value of cloisng inventory is 4800 from opening stock and balance 9600-4800=4800 units from the purchases of January 17. Therefore value of invetory=4800*14.25+4800*15
=$140,400.
Answer for weighted average = total cost/ Total number of units
=4800*14.25+9000*15+12000*17/4800+9000+12000
=15.79 per unit
Value of inventory=15.79 *9600
=$151590.70
Particulars Amount Net income 50000 Adjustments Depreciation 25000 Decrease in accounts receivables 12000 Increase in inventory -22000 Increase in accounts payable 20000 Net cash provided by operating activities 35000Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.