The comparative balance sheet of Tully\'s Inc. at 12/31/13 appears below. The fo
ID: 2422359 • Letter: T
Question
The comparative balance sheet of Tully's Inc. at 12/31/13 appears below. The following additional data were taken from the records of Tully's Inc.: 1. Net Income was $96,000 2. Depreciation Expense was $19,200 3. Equipment costing $96,000 was purchased, and fully depreciated equipment costing $18,000 was discarded. 4. Land costing $36,000 was sold for $36,000. 5. Bonds payable of $60,000 was retired at face value. 6. Issued 1,000 shares of common stock at $20 in exchange for land. 7. Cash dividends were paid - hint you can calculate the amount of dividends paid.Explanation / Answer
Tully'c Inc. Cash Flow Statement For the Year ended 31.12.2013 Particulars Amount I. Cah Flow From Operations Net Income 96,000 Add: depreciation Exp. 19,200 Operating Profit before Working Capital Changes 115,200 Less: Increase in Accounts receivables (12,000) Add: Decrease in Inventories 6,000 Add: Increase in Accounts Payables 40,800 34,800 Cash Flow from Operating activities 150,000 II. Cash Flow from Investing activities Sale of Land 36,000 Purchase of equipment (96,000) Cash Flow from Investing activities (60,000) III. Cash Flow from Financing activities Repayment of Bonds (60,000) Cash dividend Paid (12,000) Cash Flow from Financing activities (72,000) Net Increase in Cash 18,000 Cash balance as on 31.12.2012 66,000 Cash balance as on 31.12.2013 84,000 Calculation of Dividend Paid Op. Balance - retained earnings 276000 Add; net profit earned during the year 96000 372000 Less: Cls. Balance - retained Earnings 360000 Dividend paid 12000