Question

In this exercise, you will use the indirect method to create a statement of cash flows in excel for Zee Co. These amounts relate to July of 2016

Net Income $4,500

Sale Machinery $21,000

Depreciation Expense $900

Purchase of Equipment $18,000

Accounts Receivable (beginning) $6,200

Notes Payable (beginning) $5,600

Account Receivable (ending) $5,100

Notes Payable (ending) $6,600

Account payable (beginning) $3,000

Travis Jackman, Drawing $3,000

Account Payable (ending) $4,800

Cash (beginning balance) $37,400

Use the techniques from his chapter to present the statements in good form.

kindly show all calculations clearly

Answer 1

Solution:

Zee Company
Statement of Cash Flows
For July 31, 2016
Particulars	Details	Amount
Cash Flow from Operating Activities:
Net Income	$4,500.00
Adjustments to reconcile net income to net cash provided by operations:
Depreciation Expense	$900.00
Decrease in accounts receivables ($6,200 - $5,100)	$1,100.00
Increase in notes payable ($6,600 - $5,600)	$1,000.00
Increase in accounts payable ($4,800 - $3,000)	$1,800.00
Net Cash provided by operating activities		$9,300.00
Cash Flow from Investing Activities:
Proceeds from sale of machinery	$21,000.00
Cash paid for purchase of equipment	-$18,000.00
Net Cash used in Investing activities		$3,000.00
Cash Flow from Financing Activities:
Cash withdrawl by owner	-$3,000.00
Net Cash Provided by financing activities		-$3,000.00
Net Increase / (Decrease) in Cash		$9,300.00
Cash balance at beginning of year		$37,400.00
Cash balance at end of year		$46,700.00