Question

URCES The following are the financial statements of Nosker Company. ed NOSKER COMPANY Comparative Balance Sheets December 31 Video) Assets (Video) aission) 2020 2019 Cash $34,350 32,600 $19,600 Accounts receivable 18,600 Study Inventory 26,350 20,750 Equipment 59,250 77,800 Accumulated depreciation-equipment (29,700) $122,850 (23,400) $113,350 Total Liabilities and Stockholders' Equity Accounts payable Income taxes payable $28,150 $ 16,850 7,050 8,350 Bonds payable 27,700 33,950 17,200 13,850 Common stock 42,750 40,350 Retained earnings $113,350 $122,850 Total NOSKER COMPANY Income Statement For the Year Ended December 31, 2020 $241,900 Sales revenue 175,950 Cost of goods sold 65 950. Gross nrofit

Answer 1

Correct Answer:

NOSKER COMPANY
Cash Flow Statement
For year ended 31st December 2017
A. Cash Flows from Operating Activity
Net Income		$        30,200.00
Adjustments
Depreciation expense	$              17,200.00
Decrease in Income tax payable	$              (1,300.00)
Increase in Accounts receivables	$           (14,000.00)
Increase in Inventories	$              (5,600.00)
Increase in Accounts Payable	$              11,300.00
		$          7,600.00
Net cash flow from Operating activities		$        37,800.00
B. Cash flows from Investing Activities
Purchase of land
Sale of Equipment	$                 7,650.00
Net Cash flows from Investing activities		$          7,650.00
C. Cash Flows from Financing activities
Issuance of Common Stock	$                 3,350.00
payments of dividends	$            (27,800.00)
Repayment of Bond	$              (6,250.00)
Cash flows from Financing activities		$      (30,700.00)
Net Increase (Decrease) in Cash [A+B+C]		$        14,750.00
Cash at the beginning		$        19,600.00
Cash at the end		$        34,350.00

Explanation

Cash is Decreased when Current liability Decrease or Current asset Increase.

Cash is increased when Current liability increase or Current asset Decrease.

Profit on sale of asset or investment is a non-cash profit and hence will be deducted from operating income.

Depreciation or loss on sale of any asset is a non-cash expense hence it will be added to net income to get operating cash

End of answer.

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