b. Use a negative sign with cash outflow answers. WOLFF COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash Flow from Operating Activities Net Income 56.000 v Add (deduct) items to convert net income to cash basis Depreciation 17,000 Accounts Receivable Increase (9.000) v Inventory (30.000) Increase Prepaid Insurance Decrease 2,000 v Accounts Payable Decrease (3.000) v Wages Payable Increase 3,000 v Income Tax Payable Decrease (1,000) Cash Flow Provided by Operating Activities 35,000 v Cash Flow from Investing Activities Purchase of Plant Assets (55.000) Cash Flow from Financing Activities Issuance of Bonds Payable 55,000 v Payment of Dividends (29.000) Cash Provided by Financing Activities 26,000 v Ne: Change in Cash 6.000 v Cash at Beginning of Year 5,000 v Cash at End of Year 11,000 c. Free cash flow S (20,000) d. Operating-cash-flow-to-current-liabilities ratio. Round answer to two decimal places. 1.49

b. Use a negative sign with cash outflow answers. WOLFF COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash Flow from Operating Activities Net Income 56.000 v Add (deduct) items to convert net income to cash basis Depreciation 17,000 Accounts Receivable Increase (9.000) v Inventory (30.000) Increase Prepaid Insurance Decrease 2,000 v Accounts Payable Decrease (3.000) v Wages Payable Increase 3,000 v Income Tax Payable Decrease (1,000) Cash Flow Provided by Operating Activities 35,000 v Cash Flow from Investing Activities Purchase of Plant Assets (55.000) Cash Flow from Financing Activities Issuance of Bonds Payable 55,000 v Payment of Dividends (29.000) Cash Provided by Financing Activities 26,000 v Ne: Change in Cash 6.000 v Cash at Beginning of Year 5,000 v Cash at End of Year 11,000 c. Free cash flow S (20,000) d. Operating-cash-flow-to-current-liabilities ratio. Round answer to two decimal places. 1.49

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 32BE

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