Question

NOSKER COMPANY Comparative Balance Sheet December 31 2017 2016 Assets Cash $38,000 $20,000 Accounts Receivable 30,000 14,000 Inventory 27,000 20,000 78,000 Equipment Accumulated depreciation-equipment 60,000 (29,000) $126,000 (24,000) $108,000 Total Liabilities and Stockholders' Equity Accounts payable Income taxes payable Bonds payable $24,000 $15,000 7,000 8,000 27,000 33,000 Common stock 18,000 14,000 38,000 $108,000 Retained earnings 50,000 Total $126,000 NOSKER COMPANY Income Statement For the Year ended December 31, 2017 Sales revenue $242,000 Cost of goods sold Gross profit 175,000 67,000 24,000 43,000 3,000 40,000 Operating expenses Income from operations Interest expense income before income taxes Income tax expense 8,000 $32,000 Net income

Answer 1

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Nosker Corp			Workings	Amount $
Cashflow statement as on 31.12.2017			Increase in Accounts Receivable
Indirect Method	Amount $	Amount $	Closing Balance (net)	30,000.00
Particulars			Less: Opening Balance (net)	14,000.00
Income before income taxes	40,000.00		Increase in Accounts Receivable	16,000.00
Adjustment to reconcile Net Income to Net Cash
Add:			Increase in Inventory
Depreciation Expense	14,500.00		Closing Balance	27,000.00
Less:			Less: Opening Balance	20,000.00
Income Tax paid	9,000.00		Increase in Inventory	7,000.00
Cash flow from Operations		45,500.00
Changes in Current Assets/Current Liabilities			Increase in Accounts Payable
Increase in Accounts Receivable	(16,000.00)		Closing Balance	24,000.00
Increase in Inventory	(7,000.00)		Less: Opening Balance	15,000.00
Increase in Accounts Payable	9,000.00		Increase in Accounts Payable	9,000.00
Net cash provided by (Used for) operating activities		31,500.00
			Income Tax paid
Cash flow from investing activities			Opening Balance- Income Tax Payable	8,000.00
Equipment sold	8,500.00		Add: Income Tax for 2017	8,000.00
Net cash provided by (Used for) investing activities		8,500.00	Less: Closing Balance- Income Tax Payable	7,000.00
			Income Tax paid	9,000.00
Cash flow from financing activities
Bonds Payable Paid	(6,000.00)		Gain or loss on sale of Equipment
Common stock issued	4,000.00		Book Value	8,500.00
Dividend paid	(20,000.00)		Sale Value	8,500.00
Net cash provided by (Used for) financing activities		(22,000.00)	Gain or loss on sale of Equipment	-
Net Increase/(Decrease) in cash		18,000.00	Bonds Payable Paid
Cash Balance, Jan 1, 2017		20,000.00	Closing Balance	27,000.00
Cash Balance, Dec 31, 2017		38,000.00	Less: Opening Balance	33,000.00
			Bonds Payable Paid	(6,000.00)
			Common stock issued
			Closing Balance	18,000.00
			Less: Opening Balance	14,000.00
			Common stock issued	4,000.00
Answer b
Free Cashflow
Net cash provided by operating activities		45,500.00
Less: capital Expenditures		-
Less: Dividends		(20,000.00)
Free Cashflow		25,500.00