Facts Last Name, First Name Portfolio Project You are the accountant for Smart Construction Company, a large construction company in Colorado. You have been presented with the following financial information for Smart and asked to prepare the Statement of Cash Flows for the year ended June 30, 2017. You will complete all work for the project in this excel file, which includes the following tabs: 1. Facts - Information taken from Smart's accounting records and additional information regarding the cash flows as of June 30, 2017. 2.

Worksheet - Worksheet template (also see Example 21.3a in text). 3. Cash Flows - Statement of Cash Flows template (also see Example 21.3b in text). Account Balances June 30, 2016 June 30, 2017 Debits Cash $ 361,700 $ 880,550 Accounts Receivable 100,,000 Marketable Securities (at cost) 11,,000 Allowance for Change in Value 1,,800 Construction in Process 168,,000 Prepaid Expenses 45,,000 Investments (long-term) - 0 13,500 Leased Equipment - 0 20,000 Building 30, Deferred tax asset 5,,200 Land 10,,500 Discount on Bonds Payable - 0 1,305 Totals 734,,482, Credits Allowance for doubtful accounts $ 6,000 $ 4,500 Accounts Payable 87,,000 Deferred tax liability 1,,300 Income Taxes Payable 3,,000 Note Payable (long-term) 3, Accumulated Depreciation on Building 2, Accumulated Depreciation on Leased Asset - 0 3,000 Lease obligation - 0 18,000 Interest payable on lease obligation - 0 1,800 Interest payable (Bonds) - 0 1,800 Bonds payable - 0 45,000 Billings on contruction in process 150,,000 Pension liability 150,,000 Convertible preferred stock, 0 par 9, Common Stock, par 14,,500 Additional Paid-in Capital 8,,700 Unrealized Increase in Value of Marketable Securities 1,,800 Retained Earnings 297,,455 Totals 734,,482,855 Additional information: a.

Dividends declared and paid totaled 0. b. 300 shares of common stock (at par) were issued for cash. c. On July 1, 2016, convertible preferred stock that had originally been issued at par value were converted into 500 shares of common stock. The book value method was used to account for the conversion. d. The long-term note payable was paid by issuing 250 shares of common stock at the beginning of the fiscal year. e.

Short-term marketable securities were purchased at a cost of ,300. The portfolio was increased by 0 to a ,800 fair value at year-end by adjusting the related allowance account. f. During the year, a 30% interest in Ricochet Co. was purchased as an investment for ,500. Ricochet reported ,000 in net income for the year and paid dividends of

Factslast Name First Nameportfolio Projectyou Are The Accountant For

Facts Last Name, First Name Portfolio Project You are the accountant for Smart Construction Company, a large construction company in Colorado. You have been presented with the following financial information for Smart and asked to prepare the Statement of Cash Flows for the year ended June 30, 2017. You will complete all work for the project in this excel file, which includes the following tabs: 1. Facts - Information taken from Smart's accounting records and additional information regarding the cash flows as of June 30, 2017. 2.

Worksheet - Worksheet template (also see Example 21.3a in text). 3. Cash Flows - Statement of Cash Flows template (also see Example 21.3b in text). Account Balances June 30, 2016 June 30, 2017 Debits Cash $ 361,700 $ 880,550 Accounts Receivable 100,,000 Marketable Securities (at cost) 11,,000 Allowance for Change in Value 1,,800 Construction in Process 168,,000 Prepaid Expenses 45,,000 Investments (long-term) - 0 13,500 Leased Equipment - 0 20,000 Building 30, Deferred tax asset 5,,200 Land 10,,500 Discount on Bonds Payable - 0 1,305 Totals 734,,482, Credits Allowance for doubtful accounts $ 6,000 $ 4,500 Accounts Payable 87,,000 Deferred tax liability 1,,300 Income Taxes Payable 3,,000 Note Payable (long-term) 3, Accumulated Depreciation on Building 2, Accumulated Depreciation on Leased Asset - 0 3,000 Lease obligation - 0 18,000 Interest payable on lease obligation - 0 1,800 Interest payable (Bonds) - 0 1,800 Bonds payable - 0 45,000 Billings on contruction in process 150,,000 Pension liability 150,,000 Convertible preferred stock, $100 par 9, Common Stock, $10 par 14,,500 Additional Paid-in Capital 8,,700 Unrealized Increase in Value of Marketable Securities 1,,800 Retained Earnings 297,,455 Totals 734,,482,855 Additional information: a.

Dividends declared and paid totaled $650. b. 300 shares of common stock (at par) were issued for cash. c. On July 1, 2016, convertible preferred stock that had originally been issued at par value were converted into 500 shares of common stock. The book value method was used to account for the conversion. d. The long-term note payable was paid by issuing 250 shares of common stock at the beginning of the fiscal year. e.

Short-term marketable securities were purchased at a cost of $1,300. The portfolio was increased by $300 to a $14,800 fair value at year-end by adjusting the related allowance account. f. During the year, a 30% interest in Ricochet Co. was purchased as an investment for $9,500. Ricochet reported $20,000 in net income for the year and paid dividends of $2,000 to Smart. g. $5,000 of accounts receivable were written off as uncollectible during the year. h. Smart’s inventory consists of Construction-in-Process in excess of the Billings on Construction-in-Process account balance. i.

A building was destroyed by fire during the year and insurance proceeds of $26,000 were collected. j. The 12% bonds payable were issued on February 28, 2017, at 97. They mature on February 28, 2027. The company uses the straight-line method to amortize bond premiums and discounts. k. Smart recorded pension expense of $350,000 for the year. l.

A lease agreement was signed on July 1st, 2016 for the use of equipment worth $20,000. The company determined that the transaction should be recorded as a capital lease. Worksheet SMART CONSTRUCTION COMPANY Cash Flows Worksheet For Year Ended June 30, 2017 Balances Change Worksheet Entries Account Titles 6/30/16 6/30/17 Increase (Decrease) Debit Credit Debits Noncash Accounts: Credits Cash Flows from Operating Activities: Cash Flows from Investing Activities: Cash Flows from Financing Activities Investing and Financing Activities Not Affecting Cash: Net Increase in Cash Totals Cash Flows Smart Construction Company Statement of Cash Flows For Year Ended June 30, 2017 Operating Activities: Net Income Adjustments for noncash income items: Adjustments from cash flow effect from working capital items: Net cash provided (used) by operating activities Investing activities: Net cash provided (used) by investing activities Financing Activities: Net cash provided (used) by financing activities Net increase in cash (see Schedule 1) Cash, June 30, 2016 Cash, June 30, 2017 Schedule 1: Investing and Financing Activities Not Affecting Cash

,000 to Smart. g. ,000 of accounts receivable were written off as uncollectible during the year. h. Smart’s inventory consists of Construction-in-Process in excess of the Billings on Construction-in-Process account balance. i.

A building was destroyed by fire during the year and insurance proceeds of ,000 were collected. j. The 12% bonds payable were issued on February 28, 2017, at 97. They mature on February 28, 2027. The company uses the straight-line method to amortize bond premiums and discounts. k. Smart recorded pension expense of 0,000 for the year. l.

A lease agreement was signed on July 1st, 2016 for the use of equipment worth ,000. The company determined that the transaction should be recorded as a capital lease. Worksheet SMART CONSTRUCTION COMPANY Cash Flows Worksheet For Year Ended June 30, 2017 Balances Change Worksheet Entries Account Titles 6/30/16 6/30/17 Increase (Decrease) Debit Credit Debits Noncash Accounts: Credits Cash Flows from Operating Activities: Cash Flows from Investing Activities: Cash Flows from Financing Activities Investing and Financing Activities Not Affecting Cash: Net Increase in Cash Totals Cash Flows Smart Construction Company Statement of Cash Flows For Year Ended June 30, 2017 Operating Activities: Net Income Adjustments for noncash income items: Adjustments from cash flow effect from working capital items: Net cash provided (used) by operating activities Investing activities: Net cash provided (used) by investing activities Financing Activities: Net cash provided (used) by financing activities Net increase in cash (see Schedule 1) Cash, June 30, 2016 Cash, June 30, 2017 Schedule 1: Investing and Financing Activities Not Affecting Cash

Paper for above instructions

Introduction

In preparation for Smart Construction Company's financial analysis, we will construct a Statement of Cash Flows for the year ended June 30, 2017. This statement is critical as it reveals how the company generates and utilizes cash, providing an insight into operational effectiveness, investing, and financing activities. The cash flow will be broken down into three primary categories: operating, investing, and financing activities.

Cash Flow Principles

The cash flow statement is based on actual cash transactions, contrasting with the income statement, which may include revenues and expenses that have not yet been realized in cash form (Fridson & Alvarez, 2011). Thus, adjustments based on non-cash activities, changes in working capital, and other parameters affecting cash flow will be addressed in the commentary below.

Financial Overview

Based on the information provided, Smart Construction had the following account balances as of June 30, 2017:
- Cash balance increased from 1,700 (2016) to 0,550 (2017).
- Accounts Receivable is a critical asset that needs management oversight.
- Other accounts, such as Accounts Payable, impacted the working capital requirements.

Cash Flows from Operating Activities

Operating activities typically include cash generated from goods sold and services provided, in addition to cash expenses incurred during operations (Weygandt et al., 2018).

Net Income Calculation

From the given information, we need to consider revenue items such as the realized net income of investments in Ricochet Co. While the exact income figure is not provided, adjustments can be made based on dividends received and expenses recorded.
1. Net Income from Ricochet Co: ,000
2. Dividends Received:

Factslast Name First Nameportfolio Projectyou Are The Accountant For

Facts Last Name, First Name Portfolio Project You are the accountant for Smart Construction Company, a large construction company in Colorado. You have been presented with the following financial information for Smart and asked to prepare the Statement of Cash Flows for the year ended June 30, 2017. You will complete all work for the project in this excel file, which includes the following tabs: 1. Facts - Information taken from Smart's accounting records and additional information regarding the cash flows as of June 30, 2017. 2.

Worksheet - Worksheet template (also see Example 21.3a in text). 3. Cash Flows - Statement of Cash Flows template (also see Example 21.3b in text). Account Balances June 30, 2016 June 30, 2017 Debits Cash $ 361,700 $ 880,550 Accounts Receivable 100,,000 Marketable Securities (at cost) 11,,000 Allowance for Change in Value 1,,800 Construction in Process 168,,000 Prepaid Expenses 45,,000 Investments (long-term) - 0 13,500 Leased Equipment - 0 20,000 Building 30, Deferred tax asset 5,,200 Land 10,,500 Discount on Bonds Payable - 0 1,305 Totals 734,,482, Credits Allowance for doubtful accounts $ 6,000 $ 4,500 Accounts Payable 87,,000 Deferred tax liability 1,,300 Income Taxes Payable 3,,000 Note Payable (long-term) 3, Accumulated Depreciation on Building 2, Accumulated Depreciation on Leased Asset - 0 3,000 Lease obligation - 0 18,000 Interest payable on lease obligation - 0 1,800 Interest payable (Bonds) - 0 1,800 Bonds payable - 0 45,000 Billings on contruction in process 150,,000 Pension liability 150,,000 Convertible preferred stock, $100 par 9, Common Stock, $10 par 14,,500 Additional Paid-in Capital 8,,700 Unrealized Increase in Value of Marketable Securities 1,,800 Retained Earnings 297,,455 Totals 734,,482,855 Additional information: a.

Dividends declared and paid totaled $650. b. 300 shares of common stock (at par) were issued for cash. c. On July 1, 2016, convertible preferred stock that had originally been issued at par value were converted into 500 shares of common stock. The book value method was used to account for the conversion. d. The long-term note payable was paid by issuing 250 shares of common stock at the beginning of the fiscal year. e.

Short-term marketable securities were purchased at a cost of $1,300. The portfolio was increased by $300 to a $14,800 fair value at year-end by adjusting the related allowance account. f. During the year, a 30% interest in Ricochet Co. was purchased as an investment for $9,500. Ricochet reported $20,000 in net income for the year and paid dividends of $2,000 to Smart. g. $5,000 of accounts receivable were written off as uncollectible during the year. h. Smart’s inventory consists of Construction-in-Process in excess of the Billings on Construction-in-Process account balance. i.

A building was destroyed by fire during the year and insurance proceeds of $26,000 were collected. j. The 12% bonds payable were issued on February 28, 2017, at 97. They mature on February 28, 2027. The company uses the straight-line method to amortize bond premiums and discounts. k. Smart recorded pension expense of $350,000 for the year. l.

A lease agreement was signed on July 1st, 2016 for the use of equipment worth $20,000. The company determined that the transaction should be recorded as a capital lease. Worksheet SMART CONSTRUCTION COMPANY Cash Flows Worksheet For Year Ended June 30, 2017 Balances Change Worksheet Entries Account Titles 6/30/16 6/30/17 Increase (Decrease) Debit Credit Debits Noncash Accounts: Credits Cash Flows from Operating Activities: Cash Flows from Investing Activities: Cash Flows from Financing Activities Investing and Financing Activities Not Affecting Cash: Net Increase in Cash Totals Cash Flows Smart Construction Company Statement of Cash Flows For Year Ended June 30, 2017 Operating Activities: Net Income Adjustments for noncash income items: Adjustments from cash flow effect from working capital items: Net cash provided (used) by operating activities Investing activities: Net cash provided (used) by investing activities Financing Activities: Net cash provided (used) by financing activities Net increase in cash (see Schedule 1) Cash, June 30, 2016 Cash, June 30, 2017 Schedule 1: Investing and Financing Activities Not Affecting Cash

,000
3. Pension Expense: 0,000
4. Uncollectible Accounts Written Off: ,000
5. Insurance Proceeds from Fire: ,000
Calculation of Cash Flow from Operating Activities:
- Start with Net Income.
- Add back non-cash items such as pension expense, and reduce cash outflow for uncollectible receivables (Kieso, Weygandt, & Warfield, 2016).
Assuming the net income is around 0,000 (for illustration), the adjustments will yield:
- Net Income: 0,000
- + Pension Expense: 0,000
- - Uncollectible Accounts: $(5,000)
- + Insurance Proceeds: ,000
Total Cash Provided by Operating Activities = 1,000

Cash Flows from Investing Activities

This section will monitor cash used for investments and asset acquisitions, emphasizing long-term growth. Investing cash flow activities for Smart Construction include:
1. Purchase of marketable securities: $(1,300)
2. Purchase of the investment in Ricochet: $(9,500)
Thus, the total cash flow from investing activities would be:
Total Cash Used in Investing Activities = $(10,800)

Cash Flows from Financing Activities

Financing activities summarize the cash used for equity and debt financing operations. The items include:
1. Dividends Paid: $(650)
2. Issuance of Stock: +