Problem 13-9A Condensed financial data of Cheng Inc. follow. CHENG INC. Comparat

Question

Problem 13-9A Condensed financial data of Cheng Inc. follow. CHENG INC. Comparative Balance Sheets December 31 Assets Cash Accounts receivable Inventory Prepaid expenses Investments Equipment Accumulated depreciation-equipment 2015 $89,100 91,540 111,350 28,600 137,390 270,170 (49,900 ) $678,250 2014 $47,670 33,350 101,630 25,900 113,540 242,220 (51,190 ) $513,120 Total Liabilities and Stockholders' Equity Accounts payable Accrued expenses payablee Bonds payable Common stock Retained earning:s $111,580 16,460 115,540 220,790 213,880 $678,250 $67,770 17,370 149,610 175,400 102,970 $513,120 Total

Explanation / Answer

Statement of cash flow (indirect method)

Cash flow fom operating activities Net income 158120 Adjustment to reconcile net income Depreciation exp 48410 Loss on disposal of plant assets 6700 Increase account receivable (58190) Increase inventory (9720) Increase prepaid exp (2700) Increase account payable 43810 Decrease accured expenses payable (910) Net cash flow from operating activities 185520 Cash flow from investing activities Purchase of equipment (85630) Sale of equipment 1280 Purchase investment (23850) Net cash flow from investing activities (108200) Cash flow from financing activities Dividend paid (47210) Bonds mature (34070) Issue common stock 45390 Net cash flow from financing activity (35890) Net cash flow 41430 Beginning cash 47670 Ending cash 89100

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