Problem 12-7A Presented below are the financial statements of Tamarisk Company.

Question

Problem 12-7A Presented below are the financial statements of Tamarisk Company. Tamarisk Company Comparative Balance Sheets December 31 2017 2016 Assets Cash Accounts receivable Inventory Property, plant, and equipment Accumulated depreciation Total 66,150 37,800 26,460 37,800 147,420 (60,480 (45,360) $209,790 $204,120 37,800 52,920 113,400 Liabilities and Stockholders' Equity Accounts payable Income taxes payable Bonds payable Common stock Retained earnings Total 13,230 32,130 34,020 94,500 $209,790 s 35,910 28,350 15,120 62,370 26,460 71,820 $204,120 Tamarisk Companv

Explanation / Answer

Cash flow statement: Cash flows from Operating activities: Net income for the period 60480 Adjustment required Depreciation 33075 Loss on sale of equipment (34020-17955-16065) 0 Increase in accounts receivable -11340 Increase in inventory -15120 Increase in Accounts payable 7560 Decrease in tax liability -1890 Net cash provided from Operating activities 72765 Cash flows form Investing activities: Sale of equipment 16065 Net cash provided in investing activities 16065 Cash flows from Financing activities: Repayment of bonds -30240 issue of Common Stock 7560 Dividend paid -37800 Net cash used in financing activities -60480 Net increase in cash 28350 Add: Beginning Cash balance 37800 Ending cash balance 66150 Free cash flows: Net cash provided from Operating activities 72765 Net cash provided from Investing activities 16065 Free cash flows: 88830

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