Question

Question 16 A comparative balance sheet for Rocker Company appears below: Dec. 31, 2019 ROCKER COMPANY Comparative Balance Sheet Dec. 31, 2020 Assets Cash $34,000 Accounts receivable 18,000 Inventory 25,000 Prepaid expenses 6,000 Long-term investments Equipment 60,000 Accumulated depreciation--equipment (20,000) Total assets $123,000 Liabilities and Stockholder's Equity Accounts payable $17,000 Bonds payable 36,000 Common stock 40,000 Retained earnings 30,000 Total liabilities and stockholders' equity $123,000 $11,000 13,000 17,000 9,000 17,000 33,000 (15,000) $85,000 $7,000 45,000 23,000 10,000 $85,000 Additional infor

Answer 1

Rocker company

statement of cash flows

for the year ended december 31 2020.

cash flow from operating activities
net income		35,000
adjustments to reconcile net income to
net cash provided by operating activities
depreciation expense	5000
loss on sale of long term investments	3000
increase in accounts receivable	(5000)
decrease in prepaid expenses	3000
increase in inventories	(8000)
increase in accounts payable	10,000	8,000
net cash provided by operating activities		43,000
cash flows from investing activities
sale of long term investments	14,000
purchase of equipment	(27,000)
net cash used by investing activities		(13,000)
cash flows from financing activities
issuance of common stock	17,000
retirement of bonds payable	(9,000)
payment of cash dividends	(15,000)
net cash used by financing activities		(7,000)
net increase in cash (43,000-13,000-7000)		23,000
cash at beginning of period		11,000
cash at end of period		34,000