Question

Saved 7 PA12-3 Preparing a Statement of Cash Flows (Indirect Method) (LO 12-2, LO 12-3, LO 12-4, LO 12-5] XS Supply Company is developing its annual financial statements at December 31. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized: 15 points Current Year Previous Year Balance Sheet at December 31 Cash Skopped $ 29,000 $ 34,000 35,000 41,000 121,000 (30,000) $201,000 $ 36,000 1,200 38,000 88, 600 37,200 Accounts Receivable 28,000 38,000 100,000 (25,000) $170,000 Inventory Equipment Accumulated Depreciation-Equipment Total Assets Accounts Payable Salaries and Wages Payable Note Payable (long-term) Common Stock Retained Earnings Total Liabilities and Stockholders Equity Income Statement Sales Revenue Cost of Goods Sold Other Expenses Net Income eBook $ 27,000 1,400 44,000 72,600 25,000 $170,e00 Print $201,000 References $120,000 70,000 37,800 s12,200 Additional Data: a Bought equipment for cash, $21,000 b. Paid $6,000 on the long-term note payeble. c. Issued new shares of stock for $16,000 cash d No dividends were declared or paid e Other expenses Included depreciation, $5.000, salarles and wages, $ 20,000: taxes. $6,000; utlities, $6.800. E Accounts Payable includes only inventory purchases made on credit. Becouse there are no liability accounts relating to taxes or other expenses, assume that these expenses were fully pald In cosh tI

Answer 1

A B C XS Supply Company 1 Statement of cash Flows 2 For the year ended December 31 4 Cash Flows from operating activities: 5 Net income $12,200 Adjustments to Reconcile Net income to Net cash 6 Provided by Operating activities: 7 Depreciation expense $5,000 $-7,000 $-3,000 8 Increase in accounts receivable 9 Increase in inventory 10 Increase in accounts Payable 9,000 -200 3,800 11 Decrease in salaries and wages Payable $16,000 12 Net cash Provided by operating activities 13 14 Cash Flow from investing activities: $-21,000 15 Purchase of Equipment 16 Cash Flow used in investing activities $-21,000 17 18 Cash Flows From Financing activities: 19 Repayment of long term note payable $-6,000 $16,000 20 Common stock issued $10,000 $ 5,000 $ 29,000 21 Net cash flow provided by financing activities 22 Net increase in cash 23 Beginning balance of Cash 24 Ending balance of Cash $34,000

A C XS Supply Company 1 Statement of cash Flows 2 For the yearended December 31 4 Cash Flows from operating activities: 5 Net income 12200 Adjustments to Reconcile Net income to Net cash 6 Provided by Operating activities: 7 Depreciation expense 5000 - 28000-35000 8 Increase in accounts receivable 9 Increase in inventory 10 Increase in accounts Payable 38000-41000 36000-27000 11 Decrease in salaries and wages Payable =SUM(B7:B11) +C5+C11 = 1200-1400 12 Net cash Provided by operating activities 13 14 Cash Flow from investing activities: 15 Purchase of Equipment - 100000-121000 16 Cash Flow used in investing activities +B15 17 18 Cash Flows From Financing activities: 19 Repayment of long term note payable -6000 20 Common stock issued 16000 21 Net cash flow provided by financing activities -+B19+B20 +C12+C16+C21 22 Net increase in cash 23 Beginning balance of Cash 24 Ending balance of Cash 29000 +C22+C23