Stone Retail Corporation\'s most recent comparative Balance Sheet is as follows:
ID: 2593091 • Letter: S
Question
Stone Retail Corporation's most recent comparative Balance Sheet is as follows:
Stone's net income was $46,000. No equipment was sold or purchased. Cash dividends of $40,000 were declared and paid. Stone uses the indirect method to prepare its statement of cash flows.
What is Stone's net cash provided (used) by operating activities?
($33,000)
($18,000)
$84,000
$69,000
Assets Ending Beginning Cash $51,000 $64,000 Accounts receivable 83,000 41,000 Inventory 96,000 87,000 Property, plant, and equipment 120,000 120,000 Less accumulated depreciation 65,000 50,000 Total assets $285,000 $262,000 Liabilities and Stockholders' Equity Accounts payable $12,000 $38,000 Income taxes payable 1,000 3,000 Bonds payable 30,000 5,000 Common stock 100,000 80,000 Retained earnings 142,000 136,000 Total liabilities and stockholders' equity $285,000 $262,000Explanation / Answer
Net cash provided (used) by operating activities is ($18,000)
Working:
Stone Retail Corporation Statement of cash flows for the year Net income 46000 Adjustments for getting the cash flow Depreciation (65,000 - 50,000) 15000 Accounts receivable (41,000 - 83,000) -42000 Inventory (87,000 - 96,000) -9000 Accounts payable (12,000 - 38,000) -26000 Income taxes payable (1,000 -3,000) -2000 Cash flow from operatint activities -18000 Cash flow from financing activities Cash dividend paid -40000 Bonds issue 25000 Issue of common stock 20000 Cash flow from financing activities 5000 Net cash flow -13000 Beginning cash balance 64000 Ending cash balance 51000