Question

Hello need help with A and B

Comparative balance sheet accounts of Swifty Company are presented below. SWIFTY COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31 Debit Balances 2020 Cash $69,500 Accounts Receivable 154,400 Inventory 75,600 Debt investments (available-for-sale) 54,600 Equipment 69,400 Buildings 144,800 Land 40,100 Totals $608,400 2019 $51,400 128,900 60,600 84,700 48,400 144,800 25,300 $544,100 Credit Balances Allowance for Doubtful Accounts Accumulated Depreciation Equipment Accumulated Depreciation-Buildings Accounts Payable Income Taxes Payable Long-Term Notes Payable Common Stock Retained Earnings Totals $9,900 20,800 37,100 66,600 12,100 62,000 310,000 89,900 $608,400 $7,900 13,900 28,300 59,600 10,100 70,000 260,000 94,300 $544,100 Additional data: 1. Equipment that cost $10,000 and was 60% depreciated was sold in 2020. 2. Cash dividends were declared and paid during the year. 3. Common stock was issued in exchange for land. 4. Investments that cost $34,900 were sold during the year. 5. There were no write-offs of uncollectible accounts during the year.

Answer 1

Amount $ a) Cash flow statement: Indirect Method Cash flows from operating activities: Working Profit before tax $ 110,800.00 Adjustments: Depreciation-Building $ 8,800.00 Depreciation equipment $ 12,900.00 Gain on sale of Investment $ (15,000.00) Bad debt expense $ 2,000.00 Loss on sale of Equipment $ 3,000.00 Operating profit from before working capital changes $ 122,500.00 Accounts receivable (increase)/decrease $ (25,500.00) Div receivable (increase)/decrease $ inventory (increase)/decrease $ (15,000.00) Account payable (decrease)/increase $ 7,000.00 Salary payable (decrease]/increase $ - Interest payable (decrease)/increase Income tax payable (decrease)/increase Cash generation from operation Income tax expense Net cash provided by operating activities $ $ $ 2,000.00 91,000.00 (45,200.00) $ 45,800.00 $ 45,100.00 Cash flows from investing activities: Net proceeds/(Purchase) of Investment Net proceeds/(Purchase) of Land Net proceeds/(Purchase) of Equipment Net proceeds/(Purchase) of Equipment Net cash used in investing activities $ $ (31,000.00) 1,000.00 $ 15,100.00 $ 35,200.00 Cash flows from financing activities: Net proceeds/(Repayment))of Issue of PIC in excess of par Net proceeds/(Repayment))of Issue of common stock Net proceeds/(Repayment))of Treasury stock Net proceeds/(Repayment))of Notes payable Net proceeds/(Repayment))of Bond payable Dividend paid Interest paid Net cash provided by financing activities $ (8,000.00) $ 70,000.00) $ (42,800.00) Net increase in cash Opening Cash balance, Closing Cash balance, $ $ $ 18,100.00 51,400.00 69,500.00

b) Cashflow from Operating activities under Direct Method Cash collection from account receivable Cash paid to account payable Cash paid for operating expense(251,500-8800-12,900-2000) Income tax paid Net cash provided by operating activities $ $ $ $ $ 921,500.00 (604,700.00) (227,800.00) (43,200.00) 45,800.00 $ Please do upvote if you found the answer useful. Feel free reach in the comment section in case of any clarification or queries.

Ledger Working Retained earnign Opening balance Net income $ $ 94,300.00 65,600.00 Divident paid Closing balance $ $ $ 70,000.00 89,900.00 159,900.00 $ 159,900.00 Income tax payable Tax paid Closing balance $ $ $ 43,200.00 12,100.00 55,300.00 Opening balance Tax expense $ $ $ 10,100.00 45,200.00 55,300.00 $ 48,400.00 Equipment Opening balance Addition Plant assets $ 31,000.00 Sale of asset Closing balance $ $ $ 10,000.00 69,400.00 79,400.00 79,400.00 $ Accumulated depreciation Opening balance Depreciation $ $ 13,900.00 12,900.00 Sale of asset Closing balance $ $ $ 6,000.00 20,800.00 26,800.00 $ 26,800.00 Sale of Equipment Equipment gain on sale $ $ 10,000.00 - Acc. Dep Loss on sale Proceeds from sale $ $ $ $ 6,000.00 3,000.00 1,000.00 10,000.00 $ 10,000.00