a. Using theinformation for the Seville Corporation above, calculation the cashflow from operating activities. b. Using the information forthe Seville Corporation above, calculation the cash flow frominvesting activities. c. Using the information for the SevilleCorporation above, calculation the cash flow from financingactivities. Accounts payable increase 9,000 Accounts receivable increase 4,000 Accrued liabilities decrease 3,000 Amortization expenses 6,000 Cash balance Jan 1 22,000 Cash balance Dec 31 1,500 Cash paid as dividends 2,900 Cash paid to purchase land 90,000 Cash paid to retire bonds payable atpar 60,000 Cash received from issurance of commonstock 35,000 Cash received from sale equipment 17,000 Depreciation expenes 29,000 Gain on sale of equipment inventorydecreases 4,000 Inventory decrease 13,000 Net Income 76,000 Prepaid expenses increase 2,000
| a. Using theinformation for the Seville Corporation above, calculation the cashflow from operating activities. | |
| b. Using the information forthe Seville Corporation above, calculation the cash flow frominvesting activities. | |
| c. Using the information for the SevilleCorporation above, calculation the cash flow from financingactivities. | |
| Accounts payable increase | 9,000 |
| Accounts receivable increase | 4,000 |
| Accrued liabilities decrease | 3,000 |
| Amortization expenses | 6,000 |
| Cash balance Jan 1 | 22,000 |
| Cash balance Dec 31 | 1,500 |
| Cash paid as dividends | 2,900 |
| Cash paid to purchase land | 90,000 |
| Cash paid to retire bonds payable atpar | 60,000 |
| Cash received from issurance of commonstock | 35,000 |
| Cash received from sale equipment | 17,000 |
| Depreciation expenes | 29,000 |
| Gain on sale of equipment inventorydecreases | 4,000 |
| Inventory decrease | 13,000 |
| Net Income | 76,000 |
| Prepaid expenses increase | 2,000 |
Related questions
Statement of Cash FlowsâIndirect Method
The comparative balance sheet of Amelia Enterprises, Inc. atDecember 31, 2014 and 2013, is as follows:
| Dec. 31, 2014 | Dec. 31, 2013 | ||||
| Assets | |||||
| Cash | $72,150 | $88,890 | |||
| Accounts receivable (net) | 110,870 | 119,830 | |||
| Merchandise inventory | 158,400 | 148,510 | |||
| Prepaid expenses | 6,450 | 4,500 | |||
| Equipment | 322,640 | 266,100 | |||
| Accumulated depreciation-equipment | (83,890) | (65,260) | |||
| Total | $586,620 | $562,570 | |||
| Liabilities and Stockholders'Equity | |||||
| Accounts payable (merchandise creditors) | $123,190 | $117,580 | |||
| Mortgage note payable | 0 | 168,770 | |||
| Common stock, $1 par | 19,000 | 12,000 | |||
| Paid-in capital in excess of par-common stock | 278,000 | 159,000 | |||
| Retained earnings | 166,430 | 105,220 | |||
| Total | $586,620 | $562,570 | |||
Additional data obtained from the income statement and from anexamination of the accounts in the ledger for 2014 are asfollows:
Net income, $156,700.
Depreciation reported on the income statement, $40,720.
Equipment was purchased at a cost of $78,630, and fullydepreciated equipment costing $22,090 was discarded, with nosalvage realized.
The mortgage note payable was not due until 2016, but the termspermitted earlier payment without penalty.
7,000 shares of common stock were issued at $18 for cash.
Cash dividends declared and paid, $95,490.
Required:
Prepare a statement of cash flows, using the indirect method ofpresenting cash flows from operating activities. Use the minus signto indicate cash out flows, cash payments, decreases in cash andfor any adjustments, if required.
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IKIBAN INC. | ||||||||
| 2013 | 2012 | |||||||
| Assets | ||||||||
| Cash | $ | 87,500 | $ | 44,000 | ||||
| Accounts receivable, net | 65,000 | 51,000 | ||||||
| Inventory | 63,800 | 86,500 | ||||||
| Prepaid expenses | 4,400 | 5,400 | ||||||
| Equipment | 124,000 | 115,000 | ||||||
| Accum. depreciationâEquipment | (27,000 | ) | (9,000 | ) | ||||
| Total assets | $ | 317,700 | $ | 292,900 | ||||
| Liabilities and Equity | ||||||||
| Accounts payable | $ | 25,000 | $ | 30,000 | ||||
| Wages payable | 6,000 | 15,000 | ||||||
| Income taxes payable | 3,400 | 3,800 | ||||||
| Notes payable (long term) | 30,000 | 60,000 | ||||||
| Common stock, $5 par value | 220,000 | 160,000 | ||||||
| Retained earnings | 33,300 | 24,100 | ||||||
| Total liabilities and equity | $ | 317,700 | $ | 292,900 | ||||
| IKIBAN INC. Income Statement For Year Ended June 30, 2013 | ||||||
| Sales | $ | 678,000 | ||||
| Costof goods sold | 411,000 | |||||
| Gross profit | 267,000 | |||||
| Operating expenses | ||||||
| Depreciation expense | $ | 58,600 | ||||
| Other expenses | 67,000 | |||||
| Total operating expenses | 125,600 | |||||
| 141,400 | ||||||
| Other gains (losses) | ||||||
| Gain on sale ofequipment | 2,000 | |||||
| Income before taxes | 143,400 | |||||
| Income taxes expense | 43,890 | |||||
| Netincome | $ | 99,510 | ||||
| Additional Information |
| a. | A $30,000 notepayable is retired at its $30,000 carrying (book) value in exchangefor cash. |
| b. | The only changesaffecting retained earnings are net income and cash dividendspaid. |
| c. | New equipment isacquired for $57,600 cash. |
| d. | Received cashfor the sale of equipment that had cost $48,600, yielding a $2,000gain. |
| e. | Prepaid Expensesand Wages Payable relate to Other Expenses on the incomestatement. |
| f. | All purchasesand sales of merchandise inventory are on credit. |
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Accounting prepare Statement of cahs flow indrect method anddirect method!
Balance sheet
Asset
Cash $35,473 20,238
Accounts receivable 32,552 14,496
Merchandise inventory 26,812 20,470
Property, plant, and equipment 59,924 78,086
Accumulated depreciation (29,150) (23,526)
Total $125,611 $109,764
Liability and stockholderâs equity
Accounts Payable $28,796 15,092
Income Taxes payable 6,695 7,961
Bonds payable 26,691 33,309
Common stock 17,800 13,400
Retained earning 45,629 40,002
Total $125,611 $109,764
Income Statement
Sales $243,765
Cost of Good Sold $176,279
Operating expense 23,863
Interest Expense 3,141
Income Tax expense 7,592
Net income $32,890
Additional information
Dividends declared and paid were $27,263
During the year equipment was sold for $8,353 cash. This equipmentcost $18,162 originally and had a book value of $8,353 at the timeof sale.
All depreciation expense, $15,433 is in the selling expensecategory
All sales and purchases are on accounts.
*This is direct method I solved.
| Cash flows from operatingactivities | ||
| Cash Received from customers | 225709 | |
| Deduct: Cash payments for merchandise | 168917 | |
| Cash payments for operating expenses | 23,863 | |
| Cash payments for interest | 3,141 | |
| Cash payments for income tax | 8,858 | 204779 |
| Net cash flow from operatingactivities | 20930 |
*Indrect methods I solved
| Cash Flows from operatingactivities: | ||
| Net Income | 32890 | |
| Adjustments to reconcile net income to netcash flow from operations: | ||
| Depreciation expense | 15433 | |
| Changes in current operating assets andliabilities | ||
| Increase in accounts receivable | -18056 | |
| Increase in inventory | -6342 | |
| Increase in accounts payable | 13704 | |
| Interest paid | -3141 | |
| Decrease in income taxes payable | -8858 | -7260 |
| Net cash flow provided byoperating activities | 25630 | |
| Cash flow from investing activities: | ||
| Cash recevied from sale of equipment | 8353 | |
| Net cash flow used investingactivities | 8353 | |
| Cash flow from financing activities | ||
| Cash received from sale of commonstock | 4400 | |
| Less Cash paid for dividends | -27263 | |
| Less cash paid to retire bondspayable | -6618 | |
| Net cash flow used byfinancing activities | -29481 | |
| Increase in Cash | 4502 | |
| Cash at beginning of period | 20238 | |
| Cash at end of period | 24740 | |
I'm sure there are some error. Please correct it!
