Question

Information from a comparative balance sheet& income statement for lancaster corporatation is presented below. prepare statement of cash flows

Unce sheet Income s treer Assets Cash Accounts receivable Inventory Equipment Accumulated depreciation equipment Total Assets December 31 2017 58.000 SE5800 15.000 22.000 22.000 1000 210.000 1500 00.000) 12551000 $ 19.00 Liabilities and Stockholders' Euty Accounts payable Wages payable Notes payable, long term Common stock ($1 par) Retained earnings Total Liabilities - Equity S8000 2.000 90.000 100 000 85.000 $255.000 75.000 45 000 $210.000 Income Statement for 2018 Sales Cost of Goods Sold Depreciation Expense Other Expenses Net Income 195.000 90.000 15.000 $45.000 Additional information: 1. Bought equipment for Cash, 500,000 2. Paid $10,000 of the long-term notes payable 3 Issued new shares of stock for $25,000 Cash dividends of $5,000 were declared and paid. Lancaster Corporation Statement of Cash Flows For year ending December 31, 2018

Answer 1

Statement of cash flows
For the year ended December 31,2018
Cash Flows from Operating Activities
Net Income		$45,000
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation		15000
Changes in Current Assets and Current Liabilities
Decrease in Accounts receivable	7000
Increase in Inventory	-4000
Decrease in Accounts payable	-11000
Increase in wages payable	1000	-7000
Cash flow from operating activities		$53,000
Cash Flows from Investing Activities
Purchase of equipment		-60,000
Cash used in investing activities		-60,000
Cash flow from financing activities
Decrease in notes payable	-10,000
Cash dividends paid	-5,000
Issue of new shares	25000
Cash flows from financing activities		10,000
Net cash flows		$3,000
Add: Opening cash balance		65000
Closing cash Balance		$68,000