Preparation of Statement of Cash Flow Components JEM Company's comparative balance sheets for 2016 and 2017 appear below December...

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Finance

Preparation of Statement of Cash FlowComponents
JEM Company's comparative balance sheets for 2016 and 2017 appearbelow
December 31
Assets
2017
2016
Cash
$ 68,000
$ 22,000
Accounts receivable
82,000
66,000
Inventory
170,000
189,000
Land
71,000
110,000
Equipment
280,000
200,000
Accumulated depreciation–equipment
(74,000)
(42,000)
Total
$597,000
$545,000
Liabilities and Stockholders’ Equity
Accounts payable
$ 34,000
$ 47,000
Bonds payable
150,000
200,000
Common stock ($1 par)
170,000
164,000
Retained earnings
243,000
134,000
Total
$597,000
$545,000

Additional information:
1. Net income for 2017 was $155,000; there were no gains orlosses.
2. Cash dividends of $46,000 were declared and paid.
3. Depreciation for 2017 is 32,000.

Based on the information provided, answer the following:

a. What was cash provided by operations? (4 points)

b. What was cash provided by investing activity? (3 points)

c. How much was cash provided by financing activity? (3points)

Answer & Explanation Solved by verified expert

4.0 Ratings (598 Votes)

JEM Company Statement of Cash Flows Indirect Method For the year ended December 31 2017 Amount Cash flows from Operating Activities Net Income 155000 Adjustments to reconcile net income to Net cash See Answer

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Preparation of Statement of Cash FlowComponentsJEM Company's comparative balance sheets for 2016 and 2017 appearbelowDecember 31Assets 2017 2016 Cash$ 68,000$ 22,000Accounts receivable82,00066,000Inventory170,000189,000Land71,000110,000Equipment280,000200,000Accumulated depreciation–equipment(74,000)(42,000)Total$597,000$545,000Liabilities and Stockholders’ EquityAccounts payable$ 34,000$ 47,000Bonds payable150,000200,000Common stock ($1 par)170,000164,000Retained earnings243,000134,000Total$597,000$545,000Additional information:1. Net income for 2017 was $155,000; there were no gains orlosses.2. Cash dividends of $46,000 were declared and paid.3. Depreciation for 2017 is 32,000.Based on the information provided, answer the following:a. What was cash provided by operations? (4 points)b. What was cash provided by investing activity? (3 points)c. How much was cash provided by financing activity? (3points)

Assets	2017	2016
Cash	$ 68,000	$ 22,000
Accounts receivable	82,000	66,000
Inventory	170,000	189,000
Land	71,000	110,000
Equipment	280,000	200,000
Accumulated depreciation–equipment	(74,000)	(42,000)
Total	$597,000	$545,000

Liabilities and Stockholders’ Equity

Accounts payable	$ 34,000	$ 47,000
Bonds payable	150,000	200,000
Common stock ($1 par)	170,000	164,000
Retained earnings	243,000	134,000
Total	$597,000	$545,000