The comparative balance sheet of Canace Products Inc. for December 31, 20Y6 and
ID: 2400547 • Letter: T
Question
The comparative balance sheet of Canace Products Inc. for December 31, 20Y6 and 20Y5, is as follows:
The income statement for the year ended December 31, 20Y6, is as follows:
Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows:
Equipment and land were acquired for cash.
There were no disposals of equipment during the year.
The investments were sold for $85,250 cash.
The common stock was issued for cash.
There was a $22,500 debit to Retained Earnings for cash dividends declared.
Required:
Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
Dec. 31, 20Y6 Dec. 31, 20Y5 Assets Cash $302,620 $283,460 Accounts receivable (net) 109,630 101,810 Inventories 309,480 301,410 Investments 0 116,780 Land 158,740 0 Equipment 341,450 266,490 Accumulated depreciation-equipment (79,940) (71,860) Total assets $1,141,980 $998,090 Liabilities and Stockholders' Equity Accounts payable $206,700 $196,620 Accrued expenses payable 20,560 25,950 Dividends payable 11,420 8,980 Common stock, $10 par 61,670 48,910 Paid-in capital: Excess of issue price over par-common stock 231,820 135,740 Retained earnings 609,810 581,890 Total liabilities and stockholders’ equity $1,141,980 $998,090Explanation / Answer
Cash flows statement Cash flows from Operating activities: Cash collected from Accounts receivable (1650980+101810-109630) 1643160 Cash paid for supplier of inventory (679800+309480-301410+196620-206700) -677790 Cash paid for operating expense (857420+25950-20560) -862810 Income taxx paid -23730 Net cash provided from Operating activities 78830 Cash flows from Investing activities: Investment sold 85250 Purchase of land -158740 Purchase of equipment -74960 Net cash paid for investing activities -148450 Cash flows from Financing activities: Dividend paid (22500+8980-11420) -20060 Issue of Common Stock (61670+231820-48910-135740) 108840 Net cash provided from financing activities 88780 Net increase in cash 19160 Beginning Balance in cash 283460 Ending balance n cash 302620