Question

U V W Cumparative balance sheet.) Read the requirements 0 Requirements i More info 1. Prepare the 2018 statement of cash flows, formatting operating activities by the indirect method 2. How will what you leared in this problem help you evaluate an investment? Additionally, Get Wired purchased land of $22,900 by financing it 100% with long-term notes payable during 2018. During the year, there were no sales of land no retirements of stock, and no treasury stock transactions. A plant asset was disposed of for $0 "The cost and accumulated depreciation of the disposed asset was $13,240. The plant acquisition was for cash Print Done Print Done ded by (Used for) Operating Activities crease in Accounts Receivable (1.300) preciation Expense 14800

Answer 1

1			Statement of cash flows
							$	$
	Cash flows from operating activities:
	Net income							96700
	Adjustments to reconcile net income to net cash
	Provided by (used for) operating activities:
	Increase in accounts receivable						-1300
	Depreciation expense-Plant assets						14800
	Decrease in merchandise inventory						12100
	Increase in accounts payable						6000
	Decrease in accrued liabilities						-2900	28700
	Net cash provided by (used for) operating activities					a		125400
	Cash flows from investing activities:
	Cash payment for acquisition of plant assets					(Note:1)	-21000
	Net cash provided by (used for) investing activities					b		-21000
	Cash flows from financing activities:
	Notes redeemed					(Note:2)	-47900
	Common stock issued			(88400-64900)			23500
	Dividend paid					(Note:3)	-68400
	Net cash provided by (used for) financing activities					c		-92800
	Net increase (decrease) in cash					a+b+c		11600
	Add: Beginning balance of cash							15200
	Ending balance of cash							26800
	Note:1
	Analyze plant assets
						$
	Ending balance					116280
	Add: Plant asset disposed					13240
						129520
	Less: Beginning balance					108520
	Plant asset acquired					21000
	Note:2
	Analyze notes payable
						$
	Beginning balance					100000
	Add:Land purchased by issung notes					22900
						122900
	Less: Ending balance					75000
	Notes redeemed					47900
	Note:3
	Analyze retained earnings
						$
	Beginning balance					9800
	Add: Net income					96700
						106500
	Less: Ending balance					38100
	Dividend paid					68400
	Note:4
	For operating activities,
	Increase in current assets results in cash outflow
	Decrease in current assets results in cash inflow
	Increase in current liability results in cash inflow
	Decrease in current liability results in cash outflow
2	Learn how operating activities,investing activities and financing activities generate cash receipts and cash payments
	Learn how companies prepare the statement of cash flows