Preparing the Statement of Cash Flows Balance sheet information for Beckwith Products Company is presented below. Jan. 1 Dec. 31 Assets: Cash $25,000 $36,950 Accounts receivable 78,000 75,100 Inventory 36,000 45,300 Property, plant, and equipment 153,000 256,400 Accumulated depreciation 20,000 38,650 Total assets $272,000 $375,100 Liabilities and Equity: Accounts payable $11,000 $13,100 Interest payable 8,000 11,500 Wages payable 9,000 8,100 Notes payable 90,000 105,000 Common stock 50,000 100,000 Retained earnings 104,000 137,400 Total liabilities and equity $272,000 $375,100 Additional Information: Net income for the year was $58,400. Cash dividends of $25,000 were declared and paid during the year. During the year, Beckwith issued $50,000 of notes payable and repaid $35,000 principal relating to notes payable. Common stock was issued for $50,000 cash. Depreciation expense was $18,650, and there were no disposals of equipment. Required: Question Content Area 1. Prepare a statement of cash flows (indirect method) for Beckwith Products. Use a minus sign to indicate any decreases in cash or cash outflows. Beckwith Products CompanyStatement of Cash FlowsFor the year ending December 31 Cash flows from operating activities: $Net income Adjustments to reconcile net income to net cash flow from operating activities: $Depreciation expense Decrease in accounts receivable Increase in inventory Increase in accounts payable Increase in interest payable Decrease in wages payabl
Preparing the Statement of Cash Flows Balance sheet information for Beckwith Products Company is presented below. Jan. 1 Dec. 31 Assets: Cash $25,000 $36,950 Accounts receivable 78,000 75,100 Inventory 36,000 45,300 Property, plant, and equipment 153,000 256,400 Accumulated depreciation 20,000 38,650 Total assets $272,000 $375,100 Liabilities and Equity: Accounts payable $11,000 $13,100 Interest payable 8,000 11,500 Wages payable 9,000 8,100 Notes payable 90,000 105,000 Common stock 50,000 100,000 Retained earnings 104,000 137,400 Total liabilities and equity $272,000 $375,100 Additional Information: Net income for the year was $58,400. Cash dividends of $25,000 were declared and paid during the year. During the year, Beckwith issued $50,000 of notes payable and repaid $35,000 principal relating to notes payable. Common stock was issued for $50,000 cash. Depreciation expense was $18,650, and there were no disposals of equipment. Required: Question Content Area 1. Prepare a statement of cash flows (indirect method) for Beckwith Products. Use a minus sign to indicate any decreases in cash or cash outflows. Beckwith Products CompanyStatement of Cash FlowsFor the year ending December 31 Cash flows from operating activities: $Net income Adjustments to reconcile net income to net cash flow from operating activities: $Depreciation expense Decrease in accounts receivable Increase in inventory Increase in accounts payable Increase in interest payable Decrease in wages payabl
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 47E
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Question
100%
Preparing the Statement of Cash Flows
Balance sheet information for Beckwith Products Company is presented below.
| Jan. 1 | Dec. 31 | ||
| Assets: | |||
| Cash | $25,000 | $36,950 | |
| |
78,000 | 75,100 | |
| Inventory | 36,000 | 45,300 | |
| Property, plant, and equipment | 153,000 | 256,400 | |
| Accumulated |
20,000 | 38,650 | |
| Total assets | $272,000 | $375,100 | |
| Liabilities and Equity: | |||
| Accounts payable | $11,000 | $13,100 | |
| Interest payable | 8,000 | 11,500 | |
| Wages payable | 9,000 | 8,100 | |
| Notes payable | 90,000 | 105,000 | |
| Common stock | 50,000 | 100,000 | |
| |
104,000 | 137,400 | |
| Total liabilities and equity | $272,000 | $375,100 |
Additional Information:
- Net income for the year was $58,400.
- Cash dividends of $25,000 were declared and paid during the year.
- During the year, Beckwith issued $50,000 of notes payable and repaid $35,000 principal relating to notes payable.
- Common stock was issued for $50,000 cash.
- Depreciation expense was $18,650, and there were no disposals of equipment.
Required:
Question Content Area
1. Prepare a statement of cash flows (indirect method) for Beckwith Products. Use a minus sign to indicate any decreases in cash or
| Cash flows from operating activities: | ||
|
|
$Net income | |
| Adjustments to reconcile net income to net cash flow from operating activities: | ||
|
|
$Depreciation expense | |
|
|
Decrease in accounts receivable | |
|
|
Increase in inventory | |
|
|
Increase in accounts payable | |
|
|
Increase in interest payable | |
|
|
Decrease in wages payable | |
|
|
$Net cash provided by operating activities | |
| Cash flows from investing activities: | ||
|
|
$Equipment purchase | |
|
|
Net cash used for investing activities | |
| Cash flows from financing activities: | ||
|
|
$Cash received from issuance of notes | |
|
|
Repayment of long-term liabilities | |
|
|
Cash received from stock issue | |
|
|
Payment of dividends | |
| Net cash provided by financing activities | fill in the blank ada1f2f6505707e_29 | |
|
|
$Net increase (decrease) in cash | |
| Cash, January 1 | fill in the blank ada1f2f6505707e_32 | |
| Cash, Dec. 31 | $fill in the blank ada1f2f6505707e_33 |
Question Content Area
2. Compute the following cash-based performance measures:
Free cash flow - Cash flow adequacy (Note: Assume that the average amount of debt maturing over the next 5 years is $85,000.)
Round ratio to two decimal places. Enter negative values as negative numbers.
| Free cash flow | $fill in the blank 23f73f09901401c_1 |
| Adequacy ratio |
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