REQUIREMENT-1: CF from operating activities - indirect method REQUIREMENT-2: CF from Investing Activities - indirect method CF from Financing Activities -...

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Finance

REQUIREMENT-1:
CF from operating activities - indirectmethod
REQUIREMENT-2:
CF from Investing Activities - indirectmethod
CF from Financing Activities - indirectmethod
12/31/2020 12/31/2019
Cash $30,000 $80,000
Accounts Receivable, net 160,000 100,000
Inventory 100,000 70,000
Prepaid Rent 20,000 10,000
Total Current Assets $310,000 $260,000
Equipment $400,000 $200,000
Accumulated Depreciation -60,000 -50,000
Total Assets $650,000 $410,000
Accounts Payable $50,000 $40,000
Salaries Payable 40,000 40,000
Bonds Payable 0 50,000
Common Stock, $10 par 350,000 100,000
Retained Earnings 210,000 180,000
Total Liabilities & Stockholders' Equity $650,000 $410,000
Additional information:
1. The company reports net income of $100,000 and depreciationexpense of $20,000 for the year ending December 31, 2020.
2.Dividends declared and paid in 2020, $70,000.
3. Equipment with a cost of $20,000 and accumulated depreciation of$10,000 was sold for $3,000.
4.New equipment was purchased for cash.
5.No common stock was retired during 2020.

Answer & Explanation Solved by verified expert

4.1 Ratings (622 Votes)

cash flow statement
cash flow from operating activities
net income		100000
depreciation		20000
loss on sale of equipment		7000
changes in working capital
increase in accounts receivables		-60000
Increase in inventory		-30000
increase in prepaid rent		-10000
Increase in accounts payable		10000
cash flow from operating activities			37000

cash flow from investing activities
cash proceeds from sale of equipment		3000
purchase of equipment during the year		-220000

cash flow from investing activities			-217000

cash flow from financing activities			130000
payment of bonds		-50000
payment of dividend		-70000
proceeds from sale of common stock		250000
net cash flow from operations			-50000

beginning cash balance			80000
Year end cash balance			30000


Year end balance in equipment account		400000
value of equipment after sale of equipment of 20000	(200000-20000)	180000
purchase of new equipment		220000

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REQUIREMENT-1:CF from operating activities - indirectmethodREQUIREMENT-2:CF from Investing Activities - indirectmethodCF from Financing Activities - indirectmethod12/31/202012/31/2019Cash$30,000$80,000Accounts Receivable, net160,000100,000Inventory100,00070,000Prepaid Rent20,00010,000Total Current Assets$310,000$260,000Equipment$400,000$200,000Accumulated Depreciation-60,000-50,000Total Assets$650,000$410,000Accounts Payable$50,000$40,000Salaries Payable40,00040,000Bonds Payable050,000Common Stock, $10 par350,000100,000Retained Earnings210,000180,000Total Liabilities & Stockholders' Equity$650,000$410,000Additional information:1. The company reports net income of $100,000 and depreciationexpense of $20,000 for the year ending December 31, 2020.2.Dividends declared and paid in 2020, $70,000.3. Equipment with a cost of $20,000 and accumulated depreciation of$10,000 was sold for $3,000.4.New equipment was purchased for cash.5.No common stock was retired during 2020.

	12/31/2020	12/31/2019
Cash	$30,000	$80,000
Accounts Receivable, net	160,000	100,000
Inventory	100,000	70,000
Prepaid Rent	20,000	10,000
Total Current Assets	$310,000	$260,000

Equipment	$400,000	$200,000
Accumulated Depreciation	-60,000	-50,000
Total Assets	$650,000	$410,000

Accounts Payable	$50,000	$40,000
Salaries Payable	40,000	40,000
Bonds Payable	0	50,000
Common Stock, $10 par	350,000	100,000
Retained Earnings	210,000	180,000
Total Liabilities & Stockholders' Equity	$650,000	$410,000
Additional information:
1. The company reports net income of $100,000 and depreciationexpense of $20,000 for the year ending December 31, 2020.
2.Dividends declared and paid in 2020, $70,000.
3. Equipment with a cost of $20,000 and accumulated depreciation of$10,000 was sold for $3,000.
4.New equipment was purchased for cash.
5.No common stock was retired during 2020.