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Ravenna Company is a merchandiser that uses the indirect method to prepare the operating activities section of its statement of cash flows. Its balance sheet for this year is as follows:

	Ending Balance		Beginning Balance
Cash	$	105,400	$	126,650
Accounts receivable		83,700		90,200
Inventory		112,400		102,500
Total current assets		301,500		319,350
Property, plant, and equipment		297,000		287,000
Less accumulated depreciation		99,000		71,750
Net property, plant, and equipment		198,000		215,250
Total assets	$	499,500	$	534,600
Accounts payable	$	65,600	$	116,500
Income taxes payable		50,900		68,600
Bonds payable		123,000		102,500
Common stock		143,500		123,000
Retained earnings		116,500		124,000
Total liabilities and stockholders equity	$	499,500	$	534,600

During the year, Ravenna paid a $12,300 cash dividend and it sold a piece of equipment for $6,150 that had originally cost $14,400 and had accumulated depreciation of $9,600. The company did not retire any bonds or repurchase any of its own common stock during the year.

1.

value: 0.36 points

Required:

1.	What is the amount of the net increase or decrease in cash and cash equivalents that would be shown on the companys statement of cash flows?

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2.

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2.	What net income would the company include on its statement of cash flows?

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3.

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3.	How much depreciation would the company add to net income on its statement of cash flows?

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4.

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4-a.	If the company debited Accounts Receivable and credited Sales for $1,230,000 during the year, what is the total amount of credits recorded in Accounts Receivable during the year?

4-b.	What does the amount of these credits represent?
	Credit sales Cash collections from customers Payment to suppliers Cash sales Total sales

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5.

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5-a.	What is the amount and direction (+ or ?) of the accounts receivable adjustment to net income in the operating activities section of the statement of cash flows?

5-b.	What does this adjustment represent?
	Cash collected from customers < Credit sales Cash collected from customers > Credit sales Cash payments > Cash collected

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6.

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6-a.	If the company debited cost of goods sold and credited inventory for $820,000 during the year, what is the total amount of inventory purchases recorded on the debit side of the Inventory T-account and the credit side of the Accounts Payable T-account?

6-b.	What is the total amount of the debits recorded in the Accounts Payable T-account during the year?

6-c.	What does the amount of these debits represent?
	Cash collections Purchases Sales Supplier payments

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7.

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7-a.	What is the combined amount and direction (+ or ?) of the inventory and accounts payable adjustments to net income in the operating activities section of the statement of cash flows?

7-b.	What does this amount represent?
	Cash paid to suppliers < Cost of goods sold Cash paid to suppliers > Purchases Cash paid to suppliers > Cost of goods sold

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8.

value: 0.36 points

8-a.	If the company debited income tax expense and credited income taxes payable $1,540 during the year, what is the total amount of the debits recorded in the Income Taxes Payable account?

8-b.	What does the amount of these debits represent?
	Tax refunds Taxes payable Cash paid for income taxes

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9.

value: 0.36 points

9-a.	What is the amount and direction (+ or ?) of the income taxes payable adjustment to net income in the operating activities section of the statement of cash flows?

9-b.	What does this adjustment represent?
	No taxes are payable Tax paid > Income tax expenses Tax paid < Income tax expenses

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10.

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10.	Would the operating activities section of the companys statement of cash flows contain an adjustment for a gain or a loss? What would be the amount and effect of the adjustment?

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11.

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11.	What is the amount of net cash provided by (used in) operating activities in the companys statement of cash flows?

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12.

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12.	What is the amount of gross cash outflows reported in the investing section of the companys statement of cash flows?

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13.

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13.	What is the companys net cash provided by (used in) investing activities?

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14.

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14.	What is the amount of gross cash inflows reported in the financing section of the companys statement of cash flows?

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15.

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15.	What is the companys net cash provided by (used in) financing activities?

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