Planner Corporation\'s comparative balance sheets are presented below. PLANNER C
ID: 2403421 • Letter: P
Question
Planner Corporation's comparative balance sheets are presented below.PLANNER CORPORATION
Comparative Balance Sheets
December 31 2017 2016 Cash $21,570 $10,700 Accounts receivable 18,200 23,400 Land 18,000 26,000 Building 70,000 70,000 Accumulated depreciation (15,000 ) (10,000 ) Total $112,770 $120,100 Accounts payable $12,370 $31,100 Common stock 75,000 69,000 Retained earnings 25,400 20,000 Total $112,770 $210,100 Additional information: 1. Net income was $27,900. Dividends declared and paid were $22,500. 2. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for $5,900. Planner Corporation's comparative balance sheets are presented below.
PLANNER CORPORATION
Comparative Balance Sheets
December 31 2017 2016 Cash $21,570 $10,700 Accounts receivable 18,200 23,400 Land 18,000 26,000 Building 70,000 70,000 Accumulated depreciation (15,000 ) (10,000 ) Total $112,770 $120,100 Accounts payable $12,370 $31,100 Common stock 75,000 69,000 Retained earnings 25,400 20,000 Total $112,770 $210,100 Additional information: 1. Net income was $27,900. Dividends declared and paid were $22,500. 2. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for $5,900. PLANNER CORPORATION
Statement of Cash Flows
For the Year Ended December 31, 2017 $ Planner Corporation's comparative balance sheets are presented below.
PLANNER CORPORATION
Comparative Balance Sheets
December 31 2017 2016 Cash $21,570 $10,700 Accounts receivable 18,200 23,400 Land 18,000 26,000 Building 70,000 70,000 Accumulated depreciation (15,000 ) (10,000 ) Total $112,770 $120,100 Accounts payable $12,370 $31,100 Common stock 75,000 69,000 Retained earnings 25,400 20,000 Total $112,770 $210,100 Additional information: 1. Net income was $27,900. Dividends declared and paid were $22,500. 2. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for $5,900.
Explanation / Answer
Cash flow from operating activities net income for the year 27,900 Adjustments to reconcile net income to Cash flow from operating activities Depreciation expense 5,000 loss on sale of land 2,100 Decrease in accounts receivable 5200 Decrease in accounts payable -18730 -6430 Net cash from operating activities 21,470 cash flow from investing activity cash from sale of land 5,900 net cash provided by operating activities 5,900 Cash flow from financing activity Cash from common stock issue 6,000 Cash dividend paid -22,500 net cash used by financing activitu -16500 net increase in cash 10,870 Cash at the beginning of the year 10,700 cash at year end 21,570 Free cash flow cash flow from operating activites - cash dividend 21,470-22500 -1030