Question

QUESTION 6

1. Burns Corporation's net income last year was $99,200. Changes in the company's balance sheet accounts for the year appear below:

   	Increases (Decreases)
   Asset and Contra-Asset Accounts:
   Cash and cash equivalents	$	21,900
   Accounts receivable	$	13,500
   Inventory	$	( 16,800)
   Prepaid expenses	$	4100
   Long-term investments	$	10,200
   Property, plant, and equipment	$	77,000
   Accumulated depreciation	$	33,200
   Liability and Equity Accounts:
   Accounts payable	$	( 19,600)
   Accrued liabilities	$	16,800
   Income taxes payable	$	4200
   Bonds payable	$	( 61,200)
   Common stock	$	41,600
   Retained earnings	$	94,900

   The company did not dispose of any property, plant, and equipment, sell any long-term investments, issue any bonds payable, or repurchase any of its own common stock during the year. The company declared and paid a cash dividend of $4300.

   Required:

   Complete the following Operating Activities schedule:

   	$
   Adjustments
   Depreciation Expense	$
   Change in	$(13,500)
   Change in Inventory	$
   Change in Prepaid Expenses	$(4,100)
   Change in	$
   Change in Accrued Liabilities	$
   Change in Income Taxes Payable	$4,200
   Net Cash Provided by Operating Activities	$

Answer 1

Net income	$     99,200.00
Adjustments
Depreciation Expense	$     33,200.00
Change in accounts receivable	$ (13,500.00)
Change in Inventory	$     16,800.00
Change in Prepaid Expenses	$     (4,100.00)
Change in Accounts payable	$ (19,600.00)
Change in Accrued Liabilities	$     16,800.00
Change in Income Taxes Payable	$       4,200.00
Net Cash Provided by Operating Activities	$ 133,000.00

General notes for cash flow
Cash is increased when Current liability increase or Current asset Decrease.
Cash is Decreased when Current liability Decrease or Current asset Increase.
Depreciation or loss on sale of any asset is a non cash expense hence it will be added to net income to get operating cash
Profit on sale of asset or investment is a non cash profit and hence will be deducted from operating income.