Question

Pepare a Cash Flow Statement using the indirect method. (all information is given).

Robust Robots, Inc. Comparative Balance Sheet December 31, 2019 and 2018 Assets 2019 2018 Current Assets: Cash Accounts Receivable, net Merchandise Inventory Supplies Prepaid Insurance Total Current Assets $ $ $ $ $ 65,000 150,000 135,000 9,700 30,000 389,700 $ $ $ $ $ $ 80,000 100,000 70,000 500 10,000 260,500 Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation - Equipment Total Property, Plant, and Equipment Total Assets 500,000 (80,000) 420,000 809,700 $ $ $ 240,000 (90,000) 150,000 410,500 4 Page

Answer 1

Sol: Cash For Flow statement of Robust Robots, Inc the period ended - 31st Dec 2014 Amount USD Bar USD Particulars ② Cash Flow From operating achvities: Ner Income Cafta Tax) 55,500 Adjustment - Non Cash Expenses Non operating income taxpenses. Add Depreciation (Non-Cash Expense) 20000 Add - loss on sale of equipment 5213 - (Non-operating 1111 3656 23,786 Addy Interest Expense (Non-operating) Add: Federal Income Tax Expense . (Actual paid will - be considered) Adjustment Change in Current Assen & Current liabilities → Increase in Accounts Receivable (959000-100000) & Increase inventory (135000-70000) (50000) (65,000

Amount Amount - (9200 Increase in Supplies (9700-500) Increase in prepaid Insurance (20,000) (30000 – 15000) Increase in Accounts payable 110,000 (150000 - 60000) - & Decrease in (10ooo) unearned Revenue Cu0000 - 50000 - Increase 10000 in salarien payable CL10000 - 20000) Cash Flow from operating activies 73,955 before Taxes paid less: Taxes paid (more & below) (23,786) Net Cash Flow from operating Achuiti 50169

Cash Flow from investing Achutes. 54,787 proceeds from sale d Asset. (Refer Note ) purchase a Equipment. - (Refer Note 3) (3,59000) Investing Net Cash Flow I rom Activityes (B) (9915,213) - - from Financing ② cash flow Achivitieri Issue a 1137700 common stock. (Note ) paid (mentioned in as paidan qustin Dividend (10000) Interest pald - CNote ) (3656) 130000 Note payable (Raised During the year) cash flow from Financing Activities (c) I wer 2,30au4

Amountin Amount in USD USD - Net Increase for Decrease in Cash (15000) CA)+B) +© - Add: Cash 80000 at the beginning of the year. Cash at the end of the 65,000 year

Notes' ① Taxen paid only to considered in operating activities since in the given cash as there no movement in Federal Tax liability from 2018 to 2019 Cie $10,000) The entire expense at $23,786 as pald During the year. . proceeds from sale a asser & To know this we need to find the after Depreciation value o Equipment. which is given below! cost of Equipment - $ 90000 Depreciation Atributable to sold equipment Accumilated Depreciation at the begingy a year. $ 90000 Add- Depreciation Current yeur- $20000 Total Accumulated Depreciations $ (LDOOD lent Closing balance of $80060 Acculatood Depreciation - Depreciahm Attributable to y $3000m sold asser. -

After Depreciation value Cost a anser len': Depreciation of a asser $90000 $ 20,000 $ 6900.0 Since the asser sold at a ton a $5213. The proceeds at sale is - $60000 - $5213_-3$ 54,787 ③ purchan a Equipment $ Equipment value as an 21st Dec 18 - 24gooo rent Equipment sold in 2019 - 90000 150,000 Closing balance of Equipment - as m 31st Dec 2014 Differencial - aner is due to addition a i.e $360000

- Isove a common stock Stock Stock at at the beginny of the year the end of the year 19oooo 1700.00 Issued Add Durry the year Pald in capital in excess apar 40000 43700 '113,700 3 6 Interest expense of paid as there Balance Sheet. $3656 is considered as is no outanding payable

Additional Notes:

In Cash flow operating activities:

Increase in current asset is taken as outflow reason being cash to that extent was blocked in that Asset instead liquid cash.

Similarly increase current liabilities is taken as inflow reason being cash to that extent not paid which is a cash available.