Changes in the company's balance sheet accounts over the year are summarized as follows: Accounts receivable decreased by $85,000. Accrued Interest Receivable increased by $15,000. Inventory decreased by $280,000. Accounts payable related to suppliers of merchandise decreased by $240,000. Short-term prepayments of operating expenses decreased by $18,000. Accrued liabilities for operating expenses increased by $35,000. Liability for accrued interest payable decreased by $16,000. Liability for accrued income taxes payable increased by $25,000. 9. As an investment, $120,000 of marketable securities were purchased during the year. Marketable securities with a book value of $210,000 were sold. $250,000 was invested as a loan to another company. $190,000 of loan given before were collected. $3,800,000 of plant assets were purchased for cash. Plant assets with a book value of $360,000 were sold during the year. $740,000 were borrowed as notes payable (long term). $620,000 of notes payable (long term) were paid during the year. Bonds payable issued during the year was $1,100,000. $890,000 of capital stock was issued during the year. Retained earnings at the beginning of the year was $1,500,000 and at the end of year was $1,810,000. Dividend was declared and paid in cash during the year. Cash balance at the beginning of the year was $448,000 and at the end of the year was $330,000. All investing and financing activities were cash transactions. Prepare a complete statement of cash flows for Bengal Products Inc. for the year 2020 using the direct method and show the reconcillation of cash flow from operating activities using the indirect method.

Quickbooks Online Accounting

3rd Edition

ISBN:9780357391693

Author:Owen

Publisher:Owen

Chapter5: Operating Activities: Purchases And Cash Payments

Section: Chapter Questions

Problem 3.4C

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Changes in the company's balance sheet accounts over the year are summarized as follows:

Accounts receivable decreased by $85,000.
Accrued Interest Receivable increased by $15,000.
Inventory decreased by $280,000.
Accounts payable related to suppliers of merchandise decreased by $240,000.
Short-term prepayments of operating expenses decreased by $18,000.
Accrued liabilities for operating expenses increased by $35,000.
Liability for accrued interest payable decreased by $16,000.
Liability for accrued income taxes payable increased by $25,000.
9. As an investment, $120,000 of marketable securities were purchased during the year.
Marketable securities with a book value of $210,000 were sold.
$250,000 was invested as a loan to another company.
$190,000 of loan given before were collected.
$3,800,000 of plant assets were purchased for cash.
Plant assets with a book value of $360,000 were sold during the year.
$740,000 were borrowed as notes payable (long term).
$620,000 of notes payable (long term) were paid during the year.
Bonds payable issued during the year was $1,100,000.
$890,000 of capital stock was issued during the year.
Retained earnings at the beginning of the year was $1,500,000 and at the end of year was $1,810,000.
Dividend was declared and paid in cash during the year.
Cash balance at the beginning of the year was $448,000 and at the end of the year was $330,000.
All investing and financing activities were cash transactions.

Prepare a complete statement of cash flows for Bengal Products Inc. for the year 2020 using the direct method and show the reconcillation of cash flow from operating activities using the indirect method.

ACT 201 Section 5 Final Assignment Spring 2021 - Excel
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Bengal Products Inc.
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Income Statement
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For the year ended December 31, 2020
12
13
Revenue:
Net Sales
$
9,500,000
$
14
15
Interest Income
320,000
16
Gain on Sales of Marketable Securities
$
70,000
17
Total revenue and gains
$ 9,890,000
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Costs and expenses:
$ 4,860,000
Cost of goods sold
Operating expenses
(Including depreciation of 700,000)
Interest expense
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$ 3,740,000
$ 270,000
$ 300,000
$
21
22
23
Income tax expenses
24
Loss on sales of plant assets
90,000
25
Total costs, expenses and losses
$ 9,260,000
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Net Income
$
630,000
Depreciation Problem
Cash Flow Problem
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