The comparative balance sheets for Rothlisberger Company as of December 31 are p
ID: 2589512 • Letter: T
Question
The comparative balance sheets for Rothlisberger Company as of December 31 are presented below.
ROTHLISBERGER COMPANY
Comparative Balance Sheets
December 31
Assets
2015
2014
$71,000
$44,700
43,610
61,650
151,660
141,690
14,830
21,390
104,000
130,560
199,890
199,890
(59,140
)
(40,110
)
228,420
155,870
(45,530
)
(34,630
)
$708,740
$681,010
Liabilities and Stockholders’ Equity
$47,600
$39,670
259,200
299,020
199,050
159,230
202,890
183,090
$708,740
$681,010
Additional information:
Prepare a statement of cash flows for the year ended December 31, 2015, using the indirect method
ROTHLISBERGER COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2015
Adjustments to reconcile net income to
ROTHLISBERGER COMPANY
Comparative Balance Sheets
December 31
Assets
2015
2014
Cash$71,000
$44,700
Accounts receivable43,610
61,650
Inventory151,660
141,690
Prepaid expenses14,830
21,390
Land104,000
130,560
Buildings199,890
199,890
Accumulated depreciation—buildings(59,140
)
(40,110
)
Equipment228,420
155,870
Accumulated depreciation—equipment(45,530
)
(34,630
)
Total$708,740
$681,010
Liabilities and Stockholders’ Equity
Accounts payable$47,600
$39,670
Bonds payable259,200
299,020
Common stock, $1 par199,050
159,230
Retained earnings202,890
183,090
Total$708,740
$681,010
Explanation / Answer
ROTHLISBERGER COMPANY Statement of Cash Flows For the Year Ended December 31, 2015 Cash flows from operating activities Net income $37,290 Adjustments to reconcile net income to net cash provided by operating activities Depreciation expense $ 42,060 Loss on sale of equipment 3,790 Decrease in accounts receivable 18,040 Increase in inventory (9,970) Decrease in prepaid expenses 6,560 Increase in accounts payable 7,930 $ 68,410 Net cash provided by operating activities $ 105,700 Cash flows from investing activities Sale of land 26,560 Sale of equipment 6,920 Purchase of equipment (95,390) Net cash used by investing activities (61,910) Cash flows from financing activities Payment of cash dividends -17490 Net cash used by financing activities -17490 Net increase in cash 26,300 Cash at beginning of period 44,700 Cash at end of period $71,000 Noncash investing and financing activities Conversion of bonds by issuance of common stock $39,820