Following are selected balance sheet accounts of Tamarisk Bros. Corp. at Decembe

Question

Following are selected balance sheet accounts of Tamarisk Bros. Corp. at December 31, 2017 and 2016, and the increases or decreases in each account from 2016 to 2017. Also presented is selected income statement information for the year ended December 31, 2017, and additional information.

2017

2016

Increase
(Decrease)

2017

2016

Increase

Additional information:

Determine the category (operating, investing, or financing) and the amount that should be reported in the statement of cash flows for the following items.

Activity

Selected balance sheet accounts Assets

2017

2016

Increase
(Decrease)

Accounts receivable $34,100 $24,000 $10,100 Property, plant, and equipment 276,700 247,400 29,300 Accumulated depreciation—plant assets (179,600 ) (167,800 ) (11,800 ) Liabilities and stockholders’ equity

2017

2016

Increase

Bonds payable $ 48,600 $45,700 $2,900 Dividends payable 7,900 5,000 2,900 Common stock, $1 par 22,100 19,000 3,100 Additional paid-in capital 9,000 3,000 6,000 Retained earnings 103,800 91,100 12,700 Selected income statement information for the year ended December 31, 2017: Sales revenue $156,000 Depreciation 37,900 Gain on sale of equipment 14,500 Net income 31,300

Explanation / Answer

Determine the category (operating, investing, or financing) and the amount that should be reported in the statement of cash flows for the following items.

Activity a Payments for purchase of property, plant, and equipment. (247400+20000-45300-276700)-20000 Investing -54600 b Proceeds from the sale of equipment. (45300-26100+14500) Investing 33700 c Cash dividends paid. (91100+31300-103800+5000-7900) Financing -15700 d Redemption of bonds payable. (45700+20000-48600) Financing -17100

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