Question

Presented below is the 2018 income statement and comparative balance sheet information for Tiger Enterprises. TIGER ENTERPRISES Income Statement For the Year Ended December 31, 2018 ($ in thousands) Sales revenue $ 9,000 Operating expenses: Cost of goods sold $ 3,800 Depreciation 280 Insurance 300 Administrative and other 2,200 Total operating expenses 6,580 Income before income taxes 2,420 Income tax expense 968 Net income $ 1,452 Balance Sheet Information ($ in thousands) Dec. 31,2018 Dec. 31, 2017 Assets: Cash $ 380 $ 240 Accounts receivable 770 870 Inventory 700 640 Prepaid insurance 90 40 Plant and equipment 2,500 2,000 Less: Accumulated depreciation (920 ) (640 ) Total assets $ 3,520 $ 3,150 Liabilities and Shareholders' Equity: Accounts payable $ 320 $ 400 Payables for administrative and other expenses 320 440 Income taxes payable 220 190 Note payable (due 12/31/2019) 1,040 800 Common stock 980 840 Retained earnings 640 480 Total liabilities and shareholders' equity $ 3,520 $ 3,150 Required: Prepare Tiger’s statement of cash flows, using the indirect method to present cash flows from operating activities. (Hint: You will have to calculate dividend payments

Answer 1

Income Statement Sales Revenue COGS Dep Insurance Adm & Other Income before Income Tax Income Tax 9000 3800 280 300 2200 2420 968 Less Less Balance Sheet Common Stock Retained Earning 840 Cash 480 Accounts Rec 870 640 40 640 770 700 90 Inventory Accounts Payables Payable for adm and other Income tax payable Note Payable 320 320 220 1040 400 Prepaid Ins 440 190 800 Plant & Equipment 2500 640 150 Less: Dep 920 3520 3150 Opening Cash Cash flow from Operating Activ Net Proft 1452 Non Cash Items 280 968 Provision for Income tax Change In Current Assets Increase in Accounts Rec Decrease in Invento Decrease in Prepaid ins Increase in Accounts pavable Pavable for adm Income Tax paid Decrease in Note payable Add 100 50 120 938 240 1792 Cash flow from Investing Activit Purchase of Fixed Assets Cash flow from Financing Acti Issue of share Dividend paid 140 115 Retained Earnin To Dividend 1292 Ba profit 480 1452 640 1932 To Cl Balance 1932