Question

Problem 12-7A The following are the financial statements of Tamarisk, Inc.. Tamarisk, Inc. Comparative Balance Sheets December 31 Assets 2019 Cash $36,300 Accounts receivable 32,900 Inventory 30,800 Equipment 59,900 Accumulated depreciation equipment (29,300) Total $130,600 2018 $19,000 19,900 20,300 77,400 (23,300) $113,300 Liabilities and Stockholders' Equity Accounts payable Income taxes payable Bonds payable Common stock Retained earnings Total $28,400 7,000 27,800 17,800 49,600 $130,600 $16,600 8,100 32,000 14,300 42,300 $113,300 Tamarisk, Inc. Income Statement For the Year Ended December 31, 2019 Sales revenue $242,000 Cost of goods sold 176,500

Answer 1

Preparation of the Statement of Cash Flows Tamarisk, Inc., Statement of Cash Flows December 31, 2019 Particulars Cash flows from Operating Activities Net Income Add : Depreciation Amount ($) $ 31,500 $ 13,900 $ 45,400 Adjustments to reconcile net income to: Increase in Accounts Receivables Increase in Inventory Increase in Accounts Payables Decrease in Income Taxes Payables $ $ $ $ (13,000) (10,500) 11,800 (1,100) $ (12,800) Net Cash provided by Operating Activities $ 32,600 Cash flows from Investing Activities Sale of Equipment $ 9,600 Net cash used in Investing Activities $ 9,600 Cash flows from Financing Activities Repayment of Bonds Payable Investments by Stockholders' Dividends to Stockholders' $ $ $ (4,200) 3,500 (24,200) Net cash provided by Financing Activities $ (24,900) Net Increase in Cash Add: Cash Balance, January 1 Cash Balance, December 31 $ $ $ 17,300 19,000 36,300