f. Payment of dividends Answer: b. d. 15. Prepare the statement of cash flows fo

Question

f. Payment of dividends Answer: b. d. 15. Prepare the statement of cash flows for Benji Company using the indirect method. ( marks) Benji Company Income Statement For the Year Ended December 31, 2015 $8,200 Revenues Depreciation expense Other operating expenses Income before income taxes Income tax expense S 400 6,800 7.200 $1,000 340 Net income Benji Company Balance Sheet December 31, 2015 and 2014 2015 2014 2015 2014 Assets: Cash A/R Inventories Liab. & SE: $ 380 120 A/P $ 770 90 1,080 1,000 Less: Acc. Depr. 1.120) (720 Retained Earnings 780 $3,720 S 600 160 1,630 1,000 420 $3,810 640 950 2,870 580 Inc. Taxes/Pay. 2.990 Common Stock $3,810 Total Liab. & SE 840 LT debt Plant & Equip. Total Assets $3,720 Answer: Page 4 of 6

Explanation / Answer

Benji Company Statement of Cash Flows For the Year Ended December 31, 2015 Net income $      660 Adjustments to reconcile net income to net cash provided by (used for) operating activities: Depreciation        400 Changes in assets and liabilities: Accounts receivable        (60) (580-640) Inventory      (110) (840-950) Accounts payable        170 (770-600) Income taxes payable        (70)                 330 (90-160) Net cash provided by operating activities $      990 Cash flows from investing activities: Sales of plant and equipment        120 (2990-2870) Net cash provided by investing activities $      120 Cash flows from financing activities: Repayment of long-term debt      (550) (1080-1630) Dividends paid      (300) (660 NI - Incr in RE360) Net cash used by financing activities $    (850) Net increase (decrease) in cash $      260 (990+120-850) Cash at beginning of period         120 Cash at end of period $      380

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