Question

*Exercise 17-9 Rodriquez Corporation's comparative balance sheets are presented below. RODRIQUEZ CORPORATION Comparative Balance Sheets December 31 2017 2016 $16,600 24,900 Cash Accounts receivable Investments Equipment Accumulated depreciation-equipment Total 20,250 59,750 $17,700 22,500 16,150 70,150 (10,100) $116,400 (13,750 ) $107,750 Accounts payable Bonds payable Common stock Retained earnings Total $14,650 10.800 50,500 31,800 $107,750 $11,050 30,100 44,600 30,650 $116,400 Additional information: 1. Net income was $18,650. Dividends declared and paid were $17,500. 2. Equipment which cost $10,400 and had accumulated depreciation of $1,800 was sold for $3,800. 3. No noncash investing and financing activities occurred during 2017.

Answer 1

$ 18,650 $ 11,450 $ 30,100 RODRIQUEZ CORPORATION Statement of Cash Flows For Year Ended December 31, 2017 Cash flow from Operating Activities: Net Income Adjustments to reconcile net income to net Cash flow from operating activities: Depreciation expenses $ 5,450 Loss on Sale of equipment $ 4,800 Increase in Accounts Receivables $ 2,400 Increase in Accounts payable $ 3,600 Net cash provided by operating activities Cash Flow from Investing Activities Purchase of Investments $ (4,100 Sale of equipment $ 3,800 Net cash used by Investing activities Cash Flow from Financing Activities Payment of cash dividends $ (17,500) Retirement of Bonds $ 19,300) Isue of Common stock $ 5,900 Cash flow from Financing Activities Net Increase in Cash Cash balance Beginning of the year Cash balance at end of Year $ (300) $ (30,900 $ (1,100 $ 17,700 $ 16,600

Free Cash flow S 8,500 Amount Amount $ 30,100 Working Notes: Free Cash Flow Particulars Cash Flow from operating activities Less: Purchase of Investments Dividends paid Free Cash Flow $ 4,100 $ 17,500 $ 21,600 S 8,500