Required information [The following information applies to the questions displayed below.] Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Long-term investments $ 26 292 $ 11 228 151 195 8 5 477 439 512 433 (81) (70) 431 363 28 34 Total assets $ 936 $ 836 Liabilities and Stockholders' Equity Accounts payable $ 305 $ 225 Accrued liabilities 73 78 Income taxes payable 73 65 Total current liabilities 451 368 Bonds payable 199 172 Total liabilities 650 540 Common stock 163 202 Retained earnings 123 94 Total stockholders' equity 286 296 Total liabilities and stockholders' equity $ 936 $ 836 Weaver Company Income Statement For This Year Ended December 31 Sales $ 753 Cost of goods sold 449 Gross margin 304 Net operating income Selling and administrative expenses Nonoperating items: Gain on sale of investments 219 85 $ 7 Loss on sale of equipment (1) 6 Income before taxes Income taxes 91 23 Net income $ 68 During this year, Weaver sold some equipment for $19 that had cost $30 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $6 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $39 of its own stock. This year Weaver did not retire any bonds. Required: 1. Using the indirect method, determine the net cash provided by/used in operating activities for this year. (List any deduction in cash and cash outflows as negative amounts.) Weaver Company Statement of Cash Flows-Indirect Method (partial) Net income Adjustments to convert net income to a cash basis: Depreciation Gain on sale of investments Loss on sale of equipment Increase in accounts receivable Decrease in inventory Increase in prepaid expenses Increase in accounts receivable Increase in income taxes payable 0 Net cash provided by operating activities $ 0

Required information [The following information applies to the questions displayed below.] Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Long-term investments $ 26 292 $ 11 228 151 195 8 5 477 439 512 433 (81) (70) 431 363 28 34 Total assets $ 936 $ 836 Liabilities and Stockholders' Equity Accounts payable $ 305 $ 225 Accrued liabilities 73 78 Income taxes payable 73 65 Total current liabilities 451 368 Bonds payable 199 172 Total liabilities 650 540 Common stock 163 202 Retained earnings 123 94 Total stockholders' equity 286 296 Total liabilities and stockholders' equity $ 936 $ 836 Weaver Company Income Statement For This Year Ended December 31 Sales $ 753 Cost of goods sold 449 Gross margin 304 Net operating income Selling and administrative expenses Nonoperating items: Gain on sale of investments 219 85 $ 7 Loss on sale of equipment (1) 6 Income before taxes Income taxes 91 23 Net income $ 68 During this year, Weaver sold some equipment for $19 that had cost $30 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $6 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $39 of its own stock. This year Weaver did not retire any bonds. Required: 1. Using the indirect method, determine the net cash provided by/used in operating activities for this year. (List any deduction in cash and cash outflows as negative amounts.) Weaver Company Statement of Cash Flows-Indirect Method (partial) Net income Adjustments to convert net income to a cash basis: Depreciation Gain on sale of investments Loss on sale of equipment Increase in accounts receivable Decrease in inventory Increase in prepaid expenses Increase in accounts receivable Increase in income taxes payable 0 Net cash provided by operating activities $ 0

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 24CE

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