The comparative balance sheet of Cromme Inc. for December 31, 2016 and 2015, is
ID: 2419834 • Letter: T
Question
The comparative balance sheet of Cromme Inc. for December 31, 2016 and 2015, is shown as follows:
Question not attempted.
1
Dec. 31, 2016
Dec. 31, 2015
2
Assets
3
Cash
$626,640.00
$585,760.00
4
Accounts receivable (net)
226,900.00
208,390.00
5
Inventories
641,350.00
616,130.00
6
Investments
0.00
239,300.00
7
Land
328,730.00
0.00
8
Equipment
705,940.00
553,530.00
9
Accumulated depreciation-equipment
(166,970.00)
(148,000.00)
10
Total assets
$2,362,590.00
$2,055,110.00
11
Liabilities and Stockholders’ Equity
12
Accounts payable (merchandise creditors)
$425,140.00
$404,540.00
13
Accrued expenses payable (operating expenses)
42,020.00
52,750.00
14
Dividends payable
23,580.00
19,500.00
15
Common stock, $4 par
154,000.00
100,000.00
16
Paid-in capital: Excess of issue price over par—common stock
416,600.00
279,400.00
17
Retained earnings
1,301,250.00
1,198,920.00
18
Total liabilities and stockholders’ equity
$2,362,590.00
$2,055,110.00
Additional data obtained from an examination of the accounts in the ledger for 2016 are as follows:
Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities
The section of the statement of cash flows that reports the cash transactions affecting the determination of net income.
. Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. Be sure to complete the heading of the statement. In the operating activities section, use the minus sign to indicate cash outflows, decreases in cash and a net cash outflow, if required. In the investing and financing activities section, use a minus sign only to indicate a NET cash outflow for the section.
In CengageNOW, a Label is a text entry that does not have an amount associated with it.
In CengageNOW, an Amount Description is a text entry other than an Account that has an amount associated with it.
Net income
Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities
The section of the statement of cash flows that reports the cash transactions affecting the determination of net income.
. Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. Be sure to complete the heading of the statement. In the operating activities section, use the minus sign to indicate cash outflows, decreases in cash and a net cash outflow, if required. In the investing and financing activities section, use a minus sign only to indicate a NET cash outflow for the section.
Question not attempted.
Cromme Inc.
Statement of Cash Flows
1
Cash flows from operating activities:
2
3
Adjustments to reconcile net income to net cash flow from operating activities:
4
5
6
Changes in current operating assets and liabilities:
7
8
9
10
11
12
13
Cash flows from investing activities:
14
15
16
17
18
19
Cash flows from financing activities:
20
21
22
23
24
Cash at the beginning of the year
25
Cash at the end of the year
1
Dec. 31, 2016
Dec. 31, 2015
2
Assets
3
Cash
$626,640.00
$585,760.00
4
Accounts receivable (net)
226,900.00
208,390.00
5
Inventories
641,350.00
616,130.00
6
Investments
0.00
239,300.00
7
Land
328,730.00
0.00
8
Equipment
705,940.00
553,530.00
9
Accumulated depreciation-equipment
(166,970.00)
(148,000.00)
10
Total assets
$2,362,590.00
$2,055,110.00
11
Liabilities and Stockholders’ Equity
12
Accounts payable (merchandise creditors)
$425,140.00
$404,540.00
13
Accrued expenses payable (operating expenses)
42,020.00
52,750.00
14
Dividends payable
23,580.00
19,500.00
15
Common stock, $4 par
154,000.00
100,000.00
16
Paid-in capital: Excess of issue price over par—common stock
416,600.00
279,400.00
17
Retained earnings
1,301,250.00
1,198,920.00
18
Total liabilities and stockholders’ equity
$2,362,590.00
$2,055,110.00
Explanation / Answer
CASH FLOW STATEMENTS INDIRECT CASH FROM OPERATIONS Net Income $198,010 Change in accounts receivable (18,510) Change in inventory (25,220) Change in accounts payable 20,600 Change in Expense payable (10,730) Cash from operations $ 164,150 CASH FOR INVESTMENTS Acquisitions of PPE (498,670) Disposal of long-term investments 279,880 Cash for investments ($218,790) CASH FROM FINANCING Issue of common stock 191,200 Cash dividend (95,680) Cash from financing $95,520 Change in cash balance $ 40,880 Cash & Cash equivalent at beginning of year 585760 Cash & Cash equivalent at the end of year 626640