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Which account represent the source of cash activity? Freeman inc. reported the following financial statements for the last two years. Freeman, INC 2019 Income statement Sales Cos of goods sold Selling and administrative Depreciation EBIT 809,200 323,110 153,400 96,343 Interest EBT 236,347.00 53,220 Taxes Netlacome Dividends Addition to retained earings 183,127.00 36,625 2 2 128,302 Freeman, INC Balance Sheet as of December 31 2019 2018 2019 16,302 18,143 Account receivables 16,849 19,527 Inventory 23.875 28,614 Current 57,026 66,284 Ne facesses 415289 498 312 Totalsts 472315 564,596 Account payable 29 342 32,978 Long-tere debe 165300 179,400 Outils equity Toallabies and owner's 472315 564.596

Answer 1

Net income= EBT-Taxes

Dividend= Net income-Addition to retained earnings

Given,

EBT for 2019= 183,127

Taxes= 36,625

Addition to retained earnings= 128,302

Therefore, Net income for 2019= 183127-36625 = 146,502

Dividend= 146502-128302 = 18,200

Total assets= Total of liabilities and equity

Owners equity= Total of liabilities and equity – total liabilities

Given,

Total of liabilities and equity (total assets) as on 31 December 2018 = 472,315

Total of liabilities as on 31 December 2018= 29342+165300 = 194,642

Therefore, Owners equity as on 31 December 2018= 472,315-194,642 = 277,673

Total of liabilities and equity (total assets) as on 31 December 2019 = 564,596

Total of liabilities as on 31 December 2019= 32978 + 179400 = 212378

Therefore, Owners equity as on 31 December 2019= 564596 – 212378 = 352,218