Business
Engineering
Math
Science
Social Scienceexercise 12-7Shown below are comparative balance sheets for Sandhill Company.Sandhill CompanyComparative Balance SheetsDecember 31Assets 2017 2016 Cash $ 211,208 $ 68,332 Accounts receivable 273,328 236,056 Inventory 518,702 587,034 Land 248,480 310,600 Equipment 807,560 621,200 Accumulated depreciation—equipment (204,996) (99,392)Total $1,854,282 $1,723,830 Liabilities and Stockholders’ Equity Accounts payable $ 121,134 $ 133,558 Bonds payable 465,900 621,200 Common stock ($1 par) 670,896 540,444 Retained earnings 596,352 428,628 Total $1,854,282 $1,723,830 Additional information:1. Net income for 2017 was $288,858.2. Depreciation expense was $105,604.3. Cash dividends of $121,134 were declared and paid.4. Bonds payable amounting to $155,300 were redeemed for cash $155,300.5. Common stock was issued for $130,452 cash.6. No equipment was sold during 2017.7. Land was sold for its book value.Prepare a statement of cash flows for 2017 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -45,000, or in parenthesis e.g. (45,000)).
exercise 12-7
|
Sandhill Company
Comparative Balance Sheets December 31 |
||||||
|---|---|---|---|---|---|---|
|
Assets
|
2017
|
2016
|
||||
|
Cash
|
$ 211,208
|
$ 68,332
|
||||
|
Accounts receivable
|
273,328
|
236,056
|
||||
|
Inventory
|
518,702
|
587,034
|
||||
|
Land
|
248,480
|
310,600
|
||||
|
Equipment
|
807,560
|
621,200
|
||||
|
Accumulated depreciation—equipment
|
(204,996
|
)
|
(99,392
|
)
|
||
|
Total
|
$1,854,282
|
|
$1,723,830
|
|
||
|
Liabilities and Stockholders’ Equity
|
||||||
|
Accounts payable
|
$ 121,134
|
$ 133,558
|
||||
|
Bonds payable
|
465,900
|
621,200
|
||||
|
Common stock ($1 par)
|
670,896
|
540,444
|
||||
|
Retained earnings
|
596,352
|
|
428,628
|
|
||
|
Total
|
$1,854,282
|
|
$1,723,830
|
|
Additional information:
| 1. | Net income for 2017 was $288,858. | |
| 2. | Depreciation expense was $105,604. | |
| 3. | Cash dividends of $121,134 were declared and paid. | |
| 4. | Bonds payable amounting to $155,300 were redeemed for cash $155,300. | |
| 5. | Common stock was issued for $130,452 cash. | |
| 6. | No equipment was sold during 2017. | |
| 7. | Land was sold for its book value. |
Prepare a statement of cash flows for 2017 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -45,000, or in parenthesis e.g. (45,000)).
Expert Answer
Statement of cash flows: This statement reports all the cash transactions which are responsible for inflow and outflow of cash, and result of these transactions is reported as ending balance of cash at the end of reported period. Statement of cash flows includes the changes in cash balance due to operating, investing, and financing activities. Operating activities include cash inflows and outflows from business operations. Investing activities includes cash inflows and cash outflows from purchase and sale of land or equipment, or investments. Financing activities includes cash inflows and outflows from issuance of common stock and debt, payment of debt and dividends.
Indirect method: Under indirect method, net income is reported first, and then non-cash expenses, losses from fixed assets, and changes in opening balances and ending balances of current assets are adjusted to reconcile the net income balance.
Prepare a statement of cash flows of company San...
Business
Accounting
Related Accounting Q&A
Q: Walt Bach Company has accumulated the following budget data for the year 2019. Sales: 40000 units, ...
A: The budgeted income statement shows all the budgeted revenues and expenses for the period for which ...
Q: Exercise 9-16 The Blue Spruce Company is planning to purchase $496,800 of equipment with an estimat...
A: Payback period: Payback period is the anticipated time period which is required to recover the cost ...
Q: Coca Cola acquired 70% of Pepsi on 1/1/14. During 2014, Coca Cola made many inventory sales to Pepsi...
A: Click to see the answer
Q: Which of the following do not show up on a post-closing trial balance? Assets and liabilities ...
A: Post closing trial balance: The post closing trial balance is a summary of all ledger accounts, and ...
Q: Miller Toy Company manufactures a plastic swimming pool at its Westwood Plant. The plant has been ex...
A: 1.Material price variance = (budgeted price-actual price)* actual quantity consumed=(5-4.95)*49,200=...
Q: Northwood Company manufactures basketballs. The company has a ball that sells for $35. At present, t...
A: Note: The answers provided by you for the first 3 requirements are correct. Hence, I am solving from...
Q: Work-in-Process Inventory, November 1 45,000 units Work-in-Process Inventory, November 30 23...
A: Units completed and transferred inventory:Units completed and transferred inventory represents the n...
Q: The setting of standard is a/ a worker decision b/ a management decision c/ a managerial accounting...
A: Setting Standard: Setting standard means establishing the level of performance on the basis of past ...
Q: Problem 25-2A Analysis and computation of payback period, accounting rate of return, and net present...
A: The Net Present Value of the Inflows have been computed by first computing the Net Cash inflow and t...
