Question

need help making a statement of cash flow

Forten Company, a merchandiser, recently completed its calendar- year 2015 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debited to Prepaid Expenses. The company's income statement and balance sheets follow FORTEN COMPANY Comparative Balance Sheets December 31, 2015 and 2014 $ 52,779 259 Total current asset Equipment Accum depreciation en 107.000 47.000) Liabilities and Equity 50 3755100250 motes payable Long to notes payable 101,100 150.450 Equity Common stock, 55 par value Paid in capital in Moss of par, common stock Rendering 128500 Tot aides and equity $5025 $ 700 FORTEN COMPANY Income Statement For Year Ended December 31, 2015 Sales Cost of goods sold 5602 500 300 500 Gross profit Operating expenses Depreciations Other expenses $18,700 147300 Omegano on sale of equipment 14 175 158.00 27.750 Additional Information on Year 2015 Transactions a. The loss on the cash sale of equipment was $4,175 (details in b). Sold equipment costing $44,175, with accumulated depreciation of $25,550, for $14,450 cash. 6. Purchased equipment costing $86,350 by paying $47.000 cash and signing a long-term note payable for the balance. d. Borrowed $2,700 cash by signing a short-term note payable. .. Paid $41,525 cash to reduce the long-term notes payable. Issued 2.200 shares of common stock for $20 cash per share. Declared and paid cash dividends of $47.800.

Answer 1

Amounts 130,275 Forten Company Cashflow Statement using Indirect method as at 31st December 2015 :- Particulars Amount Cash Flows From Operating Activities: Net Income Adjustments to Reconcile Net Income to Net Cash Provided by operations : Add: Depreciation Expense 18,700 Add: Loss on sale of Equipment 4,175 Changes in Working Capital:- Less: Increase in Accounts receivable (70025-54625) (15,400) Less: Increase in Inventory (269656-243800) (25,856) Add: Decrease in Prepaid expenses (1775-1340) 435 Less: Decease in Accounts Payable (109250-59375) (49,875) Add: Increase in Short term notes Payable (7400-4700) 2,700 (65,121) 65,154 Net cash provided/(used) by Operating Activities Cash Flows From Investing Activities: Cash received from sale of Equipment Cash paid for Purchase of Equipment Change in cash due to Investing Activties 14,450 (47,000) (32,550) (47,800) (41,525) 44,000 Cash Flows From Financing Cash paid for Dividends Cash paid for Retirement of Long term notes payable Cash received from issue of Common stock (2200*20) Change in cash due to Financing Net Changes in Cashflow from all activities Cash at the beginning of the year, 2015 Cash at the end of the year, 2015 (45,325) (12,721) 65,500 52,779