Following are the trial balances for Aero Corp. 12/31/14 12/31/13 dr dr cr Cash
ID: 2542408 • Letter: F
Question
Following are the trial balances for Aero Corp. 12/31/14 12/31/13 dr dr cr Cash Accounts Receivable Investments Land Equipment $ 79,400 $ 20,000 21,200 32,000 40,000 121,000 42,000 78,000 141,000 ccum. Depreciation Accounts Payable Bonds Payable Common Stock APIC Common Retained Earnings Equip. 61,200 40,000 30,000 41,000 40,000 61,000 35,000 95,000 70,000 23,200 S 234,200 $ 234,200 340,400 340,400 During 2014, Aero liquidated its investments at a gain of $2,500 Equipment costing $20,000 was purchased by giving the equipment manufacturer $20,000 in Aero Corp. bonds Net income for the year ended December 31, 2014, totalled $35,000. INSTRUCTIONS: Prepare a worksheet for Aero's statement of cash flows for the year ended December 31, 2014.Explanation / Answer
AERO's STATEMENT OF CASH FLOWS FOR THE YEAR ENDED December 31, 2014 Cash Flow Statement by indirect Method Detail Amount in $) Cash Flow from Operating activities:- Net Income during the year $35,000 Add: Depreciation for the year $21,200 Less: Gain on Investment -$2,500 Changes in Current Operating Asset and Libilities Increase in Account Receivable -$20,800 Increase in Account Payable $10,000 Net Cash Provided by Operating activities (A) $42,900 Cash flow from investing activities Sale procedd from Invenstment $34,500 Purchsed Building -$20,000 Land Purchased -$38,000 Net Cash provided by Investing activities (B) -$23,500 Cash Generated from Finance Activities Issue of Common Stock $5,000 Issue of Bond against Equipment $20,000 Increase in APIC - Common $25,000 Dividend Paid (w/Note-1) -$10,000 Net Cash provided by Financiang Activities ( C ) $40,000 Net Cash Generated ( A+B+C) $59,400 Oepning Balance of cash $20,000 Closing Balance of Cash $79,400 Working Note:1 Statement showing retain Earning Opening Balance of Retained Earning $23,200 Net Income $35,000 Closing Balance of Retained earning -$48,200 Dividend Paid $10,000