Question

Joyner Company's income statement for Year 2 follows: $ 710,000 231,000 479,000 218.000 261,000 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items: Gain on sale of equipment Income before taxes Income taxes Net income 10.000 271,000 81,300 $ 189,700 Its balance sheet amounts at the end of Years 1 and 2 are as follows: Year 2 Year 1 Assets Cast and cash equivalents Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Loan to Hymans Company Total assets Liabilities and Stockholders' Equity Accounts payable Accrued liabilities Income taxes payable Total current liabilities Bonds pavable $ 112,700 279,000 319,000 9,500 720,200 634,000 166,800 467,200 44,000 $1,231,400 $ 62,400 132,000 286,000 19,000 499,400 502,000 131,900 370,100 0 $ 869,500 $ 315,000 42,000 84,800 441,800 209.000 $ 258,000 54,000 81,500 393,500 106.000 O Type here to search

Hi! Can you please help me with required 1,2, and 3? Thank you and have a wonderful day!

Answer 1

Hi

Let me know in case you face any issue:

Format and naming convention are not available, can be slightly differnet: Solution: 189700 Cash flow from operating activities Net Income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense (166800)-(131900-10200) Gain on sale of equipment Accounts Receivable Increase Inventory Increase Prepaid Expense Decrease Accounts Payable Increase Decrease in Accrued liabilities Increase in Income tax payable 45100 -10000 -147000 -33000 9500 57000 -12000 3300 -87100 102600 Net Cash Provided by Operating Activities

102600 Statement of Cash flow Operating Activities: Net Cash Provided by Operating Activities Investing Activities: Addtion to property, plant, and equipment (502000-30600)-634000 Loan to Hymans Company Proceeds from sale of equipment -162600 -44000 30400 -176200 Net Cash used in Investing Activities Financing Activities: Issuance of bonds payable Issuance of common stock Cash Dividend paid (247600) - 92000+189700) 103000 55000 -34100 Net Cash provided by Financing Activities Change in Cash / Increase in cash Beginning cash and Cash equivalents Ending cash and cash equivalents 123900 50300 62400 112700 3) Free Cash flow = Net Cash provided by operating activities - Capital expenses - Dividends (102600)-(162600)-(34100) = -94100 Free cash flow is calculated on the basis of company policy. Sometime, Dividend is not adjusted, only capital expenses are adjusted. Sometime, Capital expenses are adjusted with Capital income.