Question

The accounting staff of Lambert Company has assembled the following information for the year ended December 31 of the current year. $ 812,000 2,500,000 2,195,000 Cash sales Credit sales Collections on accounts receivable Cash transferred from the money market fund to the general bank account Interest and dividends received Purchases (all on account) Payments on accounts payable to merchandise suppliers Cash payments for operating expenses Interest paid Income taxes paid Loans made to borrowers Collections on loans (excluding receipts of interest) Cash paid to acquire plant assets Book value of plant assets sold Loss on sales of plant assets Proceeds from issuing bonds payable Dividends paid Cash and cash equivalents, Jan. 1 250,000 100,000 1,800,000 1,520,000 1,045,000 180,000 95,000 500,000 260,000 3,100,000 655,300 79,400 2,500,000 120,000 512,000 Required: a, Prepare a statement of cash flows. Use the direct method of reporting cash flows fronti operating activities. b-1. Compute the amount of collections from customers. b-2. Compute the amount of cash paid to suppliers and employees. b-3. Compute the amount of proceeds from sales of plant assets. Complete this question by entering your answers in the tabs below.

Answer 1

Statement of Cash flows
Cash flows from operating activities
cash received from customers		3,007,000
interest and dividends received		100,000
		3,107,000
cash paid for merchandise		-1,520,000
cash paid for other operating expenses		-1,045,000
interest paid		-180,000
cash paid for income taxes		-95,000
net cash provided by operating activities			267,000
Cash flows from investing activities
Loans made to borrows		-500,000
Collections from loans to borrowers		260,000
cash paid for assets		-3,100,000
cash from sale of assets		575900
net cash provided by investing activities			-2,764,100
Cash flows from financing activities
proceeds from issuing bonds		2,500,000
payment of dividend		-120,000
net cash provided by financing activities			2,380,000
net increase in cash			-117,100
Cash balance, beginning			512,000
Cash transfer from money market to general bank			250,000
cash balance, ending			644,900

(1) Compute the amount of collections from customers.

Cash sales $ 812,000 + Collections on accounts receivable 2,195,000 = $3,007,000

(2) Compute the amount of cash paid to suppliers and employees.

Cash paid to suppliers = $1,520,000 + 1045000 = 2,565,000

(3) Compute the amount of proceeds from sales of plant assets

Proceeds from sales of plant assets $

Book value of plant assets sold 655,300 - Loss on sales of plant assets 79400 = $575,900