Question

The comparative balance sheet of Shin-Etsu Chemical Company at June 30, 2018, included the following balances SHIN-ETSU CHEMICAL COMPANY Balance Sheet June 30, 2018 and 2017 Increase (Decrease) 2018 2017 Current assets: Cash Accounts receivable Inventories Prepaid expenses Long-term investment Equipment, net Land $31.500 48,800 68,600 3,700 10,100 82.500 42,400 $287,600 $ 8,600 51.900 60,200 2,800 5,200 73.600 96,000 $298,300 $ 22,900 13.100) 8,400 900 4,900 8.900 153,600) $ (10.700) Current Liabilities: Notes payable, short-term (for general borrowing) Accounts payable Income tax payable Accrued liabilities Long-term notes payable Common stock Retained earrings S.13.400 42,400 13.800 12,800 47,400 59,800 98,000 $287,600 $ 18,100 40 300 14,500 15.200 94,100 51.200 64.900 $298,300 $ (4.700) 2.100 (700) 12.400) 46,700) 8.600 33, 100 $(10.700) Transaction data for the year ended June 30, 2018 a. Net income, $71,200. b. Depreciation expense, $5,400 c. Purchased long-term investment, $4.900 d Sold land for $46,900, including a S6,700 loss e. Acquired equipment by issuing long-term note payable, $14,300. f. Paid long-term note payable, $61,000 g. Received cash for issuance of common stock, S3,900. h. Paid cash dividends, $38.100. 1. Paid short-term note payable by issuing common stock $4.700 Required Prepare the statement of cash flows of Shin-Etsu Chemical Company for the year ended June 30, 2018

Answer 1

Particulars	$	$
Cash flow from Operating Activities
Net income	71,200
Add: Adjustments to reconcile net income to net cash provided by operating activities
Depreciation expense	5,400
Loss on sale of land	6,700
Changes in current operating assets and liabilities:
Accounts receivable decrease	3,100
Inventory increase	-8,400
Prepaid expenses increase	-900
Accounts payable increase	2,100
tax payable decrease	-700
Accrued liabilities decrease	-2,400
Net cash provided by Operating Activities		76,100
Cash flow from Investing Activities
Purchase of investment	-4,900
Sale of land	46,900
Net cash provided by Investing Activities		42,000
Cash flow from Financing Activities
Issue of common stock	3,900
Repayment of long term note payable	-61,000
Dividend paid	-38,100
Net cash used in Financing Activities		-95,200
Net increase in Cash and Cash Equivalents(I +II +III)		22,900
Add: Cash in the beginning of the period		8,600
Cash at the end of the period		31,500

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