FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Related questions
Concept explainers
Topic Video
Question
Bicycle Thief Inc., a major retailer of bicycles and accessories, operates several stores and is a
publicly traded company. The company is currently preparing its statement of
comparative statement of financial position and income statement for Bicycle Thief as at May
31, 2018 are as follows:
The following is additional information about transactions during the year ended May 31,
2018 for Bicycle Thief Inc., which follows IFRS:
a) Plant assets costing $95,000 were purchased by paying $44,000 in cash and issuing
5,000 common shares.
b) The “other expenses” relate to prepaid items.
c) In order to supplement its cash, Bicycle Thief issued 4,000 additional common shares.
d) There were no penalties assessed for the repayment of mortgage.
e) Cash dividends of $78,000 were declared and paid at the end of the fiscal year.
Required
Prepare a statement of cash flows for Bicycle Thief Inc. for the year ended May 31,
1)2018, using the direct method. Support the statement with appropriate calculations,
and provide all required disclosures.
2) Using the indirect method, calculate only the net cash flow from operating activities
for Bicycle Thief for the year ended May 31, 2018.
3) Assume that you are a shareholder of Bicycle Thief Inc. What do you think of the
dividend payout ratio that is highlighted in the statement of cash flows?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution
Trending nowThis is a popular solution!
Step by stepSolved in 3 steps with 6 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Hought Office Machines, Inc.'s accountants assembled the following selected data for the year ended December 31, 2018: E (Click the icon to view the current accounts.) E (Click the icon to view the transaction data.) Requirement 1. Prepare Hought Office Machines, Inc.'s statement of cash flows using the indirect method to report operating activities. List noncash investing and financing activities on an accompanying schedule. Complete the statement one section at a time, beginning with the cash flows from operating activities. (Use parentheses or a minus sign for numbers to be subtracted.) Hought Office Machines, Inc. Data Table Statement of Cash Flows Year Ended December 31, 2018 Cash flows from operating activities: Transaction Data for 2018: Net income Net income..... $ 60,000 Adjustments to reconcile net income to net cash Purchase of treasury stock. 14,300 provided by (used for) operating activities: Issuance of common stock for cash. 36,600 Loss on sale of equipment. 6,000…arrow_forwardFollowing are the individual financial statements for Gibson and Davis for the year ending December 31, 2024: Account Gibson $ (742,000) 327,808 247,808 (12,000) $ (180,000) Sales Cost of goods sold Operating expenses Dividend income Net income Retained earnings, 1/1/24 Net income Dividends declared Retained earnings, 12/31/24 Cash and receivables Inventory Investment in Davis Buildings (net) Equipment (net) Total assets Liabilities Cormon stock Retained earnings, 12/31/24 Total liabilities and stockholders' equity Goodwill Equipment (net) Common stock Buildings (net) Dividends declared $ (798,000) (180,000) 78,808 $ (988,000) $ 211,958 545,000 622,858 617,808 482,000 2,398,808 $ $ (860,000) (630,000) (988,000) $ (2,398,000) Complete this question by entering your answers in the tabs below. Consolidated Income Statement For the Year Ending December 31, 2024 Required A Required B Prepare a consolidated income statement for the year ending December 31, 2024. Note: Enter all amounts as…arrow_forwardTech Supplies Company, Incorporated, is a leading retailer specializing in consumer electronics. A condensed income statement and balance sheet for the fiscal year ended February 1, 2020, are shown below. Tech Supplies Company, IncorporatedBalance SheetAt February 1, 2020($ in millions)Assets Current assets: Cash and cash equivalents $ 2,126Accounts receivable (net) 1,237Inventory 5,066Other current assets 422Total current assets 8,851Long-term assets 3,708Total assets $ 12,559Liabilities and Shareholders’ Equity Current liabilities: Accounts payable $ 5,200Other current liabilities 3,975Total current liabilities 9,175Long-term liabilities 2,246Shareholders’ equity 1,138Total liabilities and shareholders’ equity $ 12,559Tech Supplies Company, IncorporatedIncome StatementFor the Year Ended February 1, 2020($ in millions)Revenues $ 39,603Costs and expenses 38,168Operating income 1,435Other income (expense)* (80)Income…arrow_forward
- Blossom Company, a major retailer of bicycles and accessories, operates several stores and is a publicly traded company. The comparative balance sheet and income statement for Blossom as of May 31, 2020, are as follows. The company is preparing its statement of cash flows. BLOSSOM COMPANYCOMPARATIVE BALANCE SHEETAS OF MAY 31 2020 2019 Current assets Cash $28,000 $20,200 Accounts receivable 74,900 58,500 Inventory 220,400 247,500 Prepaid expenses 9,000 7,000 Total current assets 332,300 333,200 Plant assets Plant assets 594,000 504,600 Less: Accumulated depreciation—plant assets 151,500 124,900 Net plant assets 442,500 379,700 Total assets $774,800 $712,900 Current liabilities Accounts payable $121,800 $114,600 Salaries and wages payable 46,800 71,900 Interest payable…arrow_forwardThe Pharoah Company has disclosed the following financial information in its annual reports for the period ending March 31, 2017: sales of $1.416 million, cost of goods sold of $815,000, depreciation expenses of $175,000, and interest expenses of $89,575. Assume that the firm has an average tax rate of 35 percent. Compute the cash flows to investors from operating activity. (Round answer to 2 decimal places, eg. 15.25.) Cash flow from operating activity 24arrow_forwardMinibikes, Inc. identified the following selected transactions that occurred during the year ended December 31, 2024: (Click the icon to view the transactions.) Identify any non-cash transactions that occurred during the year, and show how they would be reported in the non-cash investing and financing Minibikes, Inc. Statement of Cash Flows (Partial) Year Ended December 31, 2024 Non-cash Investing and Financing Activities: Total Non-cash Investing and Financing Activitiesarrow_forward
- Extracts from the balance sheet of Atlantis Inc. are as follows: 2018 Assets Current Assets: Cash and Cash Equivalents 30,000 Accounts Receivable, Net 65,000 Merchandise Inventory 50,000 Total Current Assets 145,000 Long-Term Investments 150,000 Property, Plant, and Equipment, Net 250,000 Total Assets 545,000 Total Current Liabilities 150,000 Compute the acid test ratio.arrow_forwardRequired: Compute the asset turnover ratio for 2021. (Re Asset turnover ratioarrow_forwardSamuel Corp. has provided the following information for the year ended December 31, 2018. Samuel Corp Comparative Balance Sheet December 31, 2018 and 2017 2018 2017 Inc/(dec) Current Assets: Cash $33,000 $13,000 $20,000 Accounts Receiveable 29,000 36,000 (7,000) Inventory 56,000 29,000 27,000 Plant Assets, net 126,000 92,000 34,000 Total Assets $244,000 $170,000 $74,000 Accounts Payable $9,000 $13,000 $(4,000) Accrued Liabilities 7,000 3,000 4,000 Long-Term Notes Payable 70,000 79,000 (9,000) Total Liabilities 86,000 95,000 (9,000) Common Stock $55,000 $3,000 $52,000 Retained Earnings 115,000 78,000 37,000 Treasury Stock (12,000) (6,000) (6,000) Total Stockholders' Equity $158,000 $75,000 $83,000 Total Liabilities and Stockholders Equity $244,000 $170,000 $74,000 Samuel Corp Income…arrow_forward
- Chandler Sporting Goods produces baseball and football equipment and lines of clothing. This year the company had cash and marketable securities worth $335,485, accounts payables worth $1,159,357, inventory of $1,651,599, accounts receivables of $1,488,121, short-term notes payable worth $313,663, and other current assets of $121,427. What is the company's net working capital? $3,596,632 $1,801,784 $2,123,612 $1,673,421arrow_forwardBlooming Flower Company was started in Year 1 when it acquired $61,400 cash from the issue of common stock. The following data summarize the company's first three years' operating activities. Assume that all transactions were cash transactions. Purchases of inventory Sales Cost of goods sold Selling and administrative expenses Income Statements Balance Sheets Assets Cash Required Prepare an income statement (use multistep format) and balance sheet for each fiscal year. (Hint: Record the transaction data for each accounting period in the accounting equation before preparing the statements for that year.) Merchandise inventory Complete this question by entering your answers in the tabs below. Total assets Liabilities Stockholders' equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity Year 1 $22,300 26,500 12,400 5,310 $ 60,290 9,900 Prepare a balance sheet for each fiscal year. (Hint: Record the transaction data for each accounting…arrow_forwardChew Corporation prepares its statement of cash flows using the indirect method of reporting operating activities. Net income for the 2018 fiscal year was $1,250,000. Depreciation expense of $140,000 was included withoperating expenses in the income statement. The following information describes the changes in current assets andliabilities other than cash:Increase in accounts receivable $152,000Decrease in inventories 108,000Decrease prepaid expenses 62,000Decrease in salaries payable 30,000Increase in income taxes payable 44,000Required:Calculate cash flows from operating activities for 2018.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education