Question

solve using T charts, thanks!

Complete a cash flow statement for the company using: 1. Proper header. The below headers are not proper. 2. By the indirect method 3. With T accounts clearly marked and completed for transactions 4. Include any assumptions you make in the calculations The comparative balance sheets for 2018 and 2017 and the statement of income for 2018 are given below for Wright Company. Additional information from Wright's accounting records is provided also. WRIGHT COMPANY Comparative Balance Sheets December 31, 2018 and 2017 (S in 000s) 2018 2017 Assets Cash Acoounts receivable Short-term investment Inventory Land Buildings and equipment Less: Accumulated depreciation 105 o 150 3 18 35 145 135 -35 550 135 (150) S 121 148 53 148 110 725 (205) S1,100 953 Liabilities 50 42 4 Accounts payable Salaries payable Interest payable Income tax payable Notes payable Bonds payable Shareholders' Equity 14 7 12 35 250 0 320 20 350 175 66 420 195 101 Common stock Paid-in capital-excess of par Retained eamings S 1,100 S 953 WRIGHT CMPANY Income Stalement For Year Ended December 31, 2018 (S in 000s) Revenues: Sales revenue S 620 Expenses: Cost of goods sold Salaries expense Depreciation expense Interest expense Loss on sale of land Income tax expense $ 280 88 55 18 5 94 540 $ 80 Net income Additional information from the accounting records: a. Land that originally cost $25,000 was sold for $20,000. b. The common stock of Microsoft Corporation was purchased for $35,000 as a short-term investment not classified as a cash equivalent. c. New equipment was purchased for $175,000 cash. d. A $35,000 note was paid at maturity on January 1 e. On January 1, 2018, bonds were sold at their $70,000 face value f. Common stock (70,000 par value) was sold for $90,000. g. Net income was $80,000 and cash dividends of $45,000 were paid to shareholders.

Answer 1

Wright Company ($in '000) Statement of Cashflows For the period ending 31.12.2018 Cashflow from Operating Activity Net Income 80 Adjustments: Depreciation Expense 55 Loss on sale of Land 5 Decrease in Accounts Receivable 2 Increase in Short Term Investment -35 crease in Inventory -3 Decrease in Accounts Payable Decrease in Salaries Payable -8 -4 Increase in Interest Payable Decrease in Income Tax Payable -3 11 Cash geneated from Operating Activity 91 Cashflow from Investing Activity Land Sold 20 Equipment purchased Cash used for Investing Activity -175 -155 Cashflow from Financing Activity Common Stock issued 70 Paid in Capital in excess of par 20 Bonds sold 70 Dividends paid -45 Not Payable paid off Cash used for Financing Activity -35 80 Net Increase in Cash 16 Beginning Cash Balance Ending Cash Balance 105 121 LO