Question

Required information Use the following information for the Problems below. [The following information applies to the questions displayed below.] Golden Corp., a merchandiser, recently completed its 2017 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, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow. GOLDEN CORPORATION Comparative Balance Sheets December 31, 2017 and 2016 2017 2016 Assets Cash $ 174,000 $ 118,000 Accounts receivable 98,000 81,000 Inventory 616,000 536,000 Total current assets 888,000 735,000 Equipment 361,900 309,000 Accum. depreciation—Equipment (163,000 ) (109,000 ) Total assets $ 1,086,900 $ 935,000 Liabilities and Equity Accounts payable $ 107,000 $ 81,000 Income taxes payable 38,000 30,100 Total current liabilities 145,000 111,100 Equity Common stock, $2 par value 612,000 578,000 Paid-in capital in excess of par value, common stock 206,000 175,000 Retained earnings 123,900 70,900 Total liabilities and equity $ 1,086,900 $ 935,000 GOLDEN CORPORATION Income Statement For Year Ended December 31, 2017 Sales $ 1,842,000 Cost of goods sold 1,096,000 Gross profit 746,000 Operating expenses Depreciation expense $ 54,000 Other expenses 504,000 558,000 Income before taxes 188,000 Income taxes expense 36,000 Net income $ 152,000 Problem 12-7AA Indirect: Cash flows spreadsheet LO P1, P2, P3, P4 Additional Information on Year 2017 Transactions Net income was $152,000. Accounts receivable increased. Inventory increased. Accounts payable increased. Income taxes payable increased. Depreciation expense was $54,000. Purchased equipment for $52,900 cash. Issued 13,000 shares at $5 cash per share. Declared and paid $99,000 of cash dividends. Required: Prepare a complete statement of cash flows using a spreadsheet; report operating activities under the indirect method. (Enter all amounts as positive values.)

Answer 1

$ 152,000 $ $ $ $ $ 54,000 (17,000) (80,000) 26,000 7,900 GOLDEN CORPORATION Statement of Cash flows For the year Ended December 31, 2017 Cash flows from Operating Activities: Net Income Adjustments to reconcile Net Income to Net Cash Provided by Operations Depreciation expenses Increases in accounts Receivables Increases in Inventory Increses in accounts payable Increases in Income Taxes Payable Net Cash provided by operating activities Cash Flows from Investing Activities Purchase of equipment Net Cash Used by Investing activities Cash Flows from Financing Activities Issuance of Common stock Payment of dividends Net Cash used by Financing activities Net Increase in Cash Cash balance at December 31, 2016 Cash Balance at December 31, 2017 $ $ (9,100) 142,900 | $ (52.900) $ (52,900) $ $ 65,000 (99,000) $ $ $ $ (34.000) 56,000 118,000 174,000 Working Notes: Issuance of Common stock = 13,000*$5 = $65,000