Solution: | |||
Statement of Cash Flows - Direct Method | |||
© www.excel-skills.com | Amount | ||
Cash flows from operating activities | |||
Cash Receipts: | |||
Cash receipts from customers (Wn1) | $ 1,232,000 | ||
Cash Payments: | |||
Cash paid to Supplies and Employees | $ -1,060,000 | ||
Cash Generated from Operation | $ 172,000 | ||
Net cash from operating activities | $ 172,000 | ||
Cash flows from investing activities | |||
Purchase of investment | $ -3,000 | ||
Purchase of Property Plant & Equipment | $ -300,500 | ||
Net cash used in investing activities | $ -303,500 | ||
Cash flows from financing activities | |||
Proceeds from Mortgage Payable | $ 87,000 | ||
Proceeds From issue of Share Capital | $ 80,000 | ||
Dividend Paid | $ -45,000 | ||
Net cash used in financing activities | $ 122,000 | ||
Net decrease in cash and cash equivalents | $ -9,500 | ||
Cash and cash equivalents at beginning of period | $ 55,500 | ||
Cash and cash equivalents at end of period | $ 46,000 | ||
Working notes: 1 | |||
Calculation of cash collection from customer | |||
Sales | $ 1,205,000 | ||
Add: Opening Net AR | $ 142,000 | ||
Less: Closing Net AR | $ 115,000 | ||
Cash Collected (A) | $ 1,232,000 | ||
Working notes: 2 | |||
Calculation of purhcase of inventory | |||
Cost of Goods Sold | $ 710,000 | ||
Add: Closing inventory | $ 179,000 | ||
Less : Opening Inventory | $ 124,000 | ||
Material Purhcased | $ 765,000 | ||
Calculation of amount paid to supplied | |||
Op. Balance of Acct Payable | $ 90,400 | ||
Add: Purchases | $ 765,000 | ||
Less: Cl. Balance of Account payable | $ 105,400 | ||
Cash paid (A) | $ 750,000 | ||
Working notes: 3 | |||
Calculation of amount paid for other operating expenses | |||
Other Expenses | $ 309,500 | ||
Add: Decrease in Expenses Payable | $ 500 | ||
Cash Paid (B) | $ 310,000 | ||
Total Cash Paid (A+B) | $ 1,060,000 | ||
End of Chapter Problem 18.21 The following data relate to Emporium Ltd: Emporium Ltd Income statement...
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