Question

Condensed financial data of Cheng Inc. follow CHENG INC. Comparative Balance Sheets December 31 Assets 2020 Cash $106,200 Accounts receivable 91,600 Inventory 111,800 Prepaid expenses 29,400 Investments 140,500 Equipment 264,200 Accumulated depreciation equipment (46,500) Total $697,200 2019 $47,400 33,900 101,500 25,500 114,800 242,100 (52,900) $512,300 Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Bonds payable Common stock Retained earnings Total $111,300 16,100 111,000 220,000 238,800 $697.200 $67.100 17,300 149,300 174,700 103.900 $512,300 5392,900 CHENG INC. Income Statement For the Year Ended December 31, 2020 Sales revenue Less: Cost of goods sold $136,000 Operating expenses, excluding depreciation 12,700 Depreciation expense 31,000 Income tax expense 27,600 Interest expense 4.400 Loss on disposal of plant assets 7,500 Net Income 210.200 $173,700 Additional information: 1. New equipment costing $79,900 was purchased for cash during the year. 2. Old equipment having an original cost of $57,800 was sold for $12,900 cash 3. Bonds matured and were paid off at face value for cash 4. A cash dividend of $38,800 was dedared and paid during the year. Prepare a statement of cash flows using the Indirect method. (Show amounts that decrease cash flow with elther a (15,000).) s ..-15.000 or in parenthesis

Answer 1

А 2 $ 173,700 1 CHENG INC S tatement of Cash Flows For the Year Ended December 31, 2020 4 Cash Flows from Operating Activities: 5 Net income 6 Adjustments to reconcile net income to 7 Net cash provided by operating activities 8 Depreciation expense $ 31,000 9 Loss on disposal of plant assets $ 7,500 10 Increase in accounts receivable $ -57,700 11 Increase in inventory $ -10,300 12 Increase in prepaid expenses $ -3,900 13 Increase in accounts payable $ 44,200 14 Decrease in accrued expenses payable $ -1,200 15 $ 9,600 $ 183,300 $ 12,900 $ -25,700 $ -79,900 $ -92,700 16 Net cash provided by operating activities 17 Cash Flows from Investing Activities: 18 Proceeds from sale of equipment 19 Purchase of investments 20 Purchase of equipment 21 Net cash used by investing activities 22 Cash Flows from Financing Activities 23 Proceeds from issue of common stock 24 Redemption of Bonds Payable 25 Payment of cash dividends 26 Net Cash Used by Financing Activities 27 Net Increase in Cash 28 Beginning balance of cash 29 Ending balance of cash $ 45,300 $ -38,300 $ -38,800 $ -31,800 $ 58,800 $ 47,400 $ 106,200

173700 CHENG INC Statement of Cash Flows For the Year Ended December 31, 2020 4 Cash Flows from Operating Activities: 5 Net income 6 Adjustments to reconcile net income to 7 Net cash provided by operating activities 8 Depreciation expense 31000 9 Loss on disposal of plant assets 7500 10 Increase in accounts receivable =33900-91600 11 Increase in inventory =101500-111800 12 Increase in prepaid expenses =25500-29400 13 Increase in accounts payable =111300-67100 14 Decrease in accrued expenses payable =16100-17300 15 16 Net cash provided by operating activities 17 Cash Flows from Investing Activities: 18 Proceeds from sale of equipment 12900 19 Purchase of investments =114800-140500 20 Purchase of equipment -79900 21 Net cash used by investing activities 22 Cash Flows from Financing Activities 23 Proceeds from issue of common stock =220000-174700 24 Redemption of Bonds Payable =111000-149300 25 Payment of cash dividends -38800 26 Net Cash Used by Financing Activities 27 Net Increase in Cash 28 Beginning balance of cash 29 Ending balance of cash =SUM(B8:B14) -+CD+C15 =+B18+B19+B20 =+B23+B24+B25 =+C16+C21+C26 47400 =+C27+C28