Question

Below are the most recent balance sheets for Country Kettles, Inc. Excluding accumulated depreciation, determine whether each item is a source or a use of cash, and the amount (Input all amounts as positive values): 2017 COUNTRY KETTLES, INC. Balance Sheets 2016 Assets Cash $ 32,100 Accounts receivable 71,600 Inventories 62,500 Property, plant, and 164,000 equipment Less: Accumulated 47,280 depreciation $ 31,360 74,920 65,000 176,200 51,600 Total assets $282,920 $295,880 Liabilities and Equity Accounts payable Accrued expenses Long-term debt Common stock Accumulated retained earnings $ 46,600 $ 48,860 7,9806 ,980 27,300 30,550 33,000 38,700 168,040 170,790 Total liabilities and equity $282,920 $295,880 Item Source/Use Amount Cash Accounts receivable Inventories Property, plant, and equipment Accounts payable Accrued expenses Long-term debt Common stock Accumulated retained earnings

Answer 1

Use of fund are accounts which decrease the cash balance while source of fund are accounts which would increase cash balance.
Cash account is always source of cash for business.
Item	Source/Use	Amount		Explanation
Cash	Source	740	32100-31360	Cash is always source of financing
Accounts receivable	Use	3320	74920-71600	Accounts receivable balance has increased which mean cash is not collected from customer and thus is use of cash
Inventories	Use	2500	65000-62500	Inventory has increased due to additional purchase and thus is use of cash.
Property, plant and equipment	Use	12200	176200-164000	Property, plant and equipment has increase due to purchase and thus is use of cash
Accounts payable	Source	2260	48860-46600	Accounts payable has increase which mean cash is not paid and thus is source of cash
Accrued expenses	Use	1000	7980-6980	Accrued expenses are paid and thus is use of cash
Long term debt	Source	3250	30550-27300	Long term debt balance has increase due to additional financing obtained and thus is source of cash
Common stock	Source	5700	38700-33000	Additional common stock issued increases cash balance and thus is source of cash.
Accumulated retained earnings	Source	2750	170790-168040	Increase in retained earnings mean additional fund generated from operating activity which is source of cash