Loose Leaf for Financial Accounting: Information for Decisions
9th Edition
ISBN: 9781260158762
Author: John J Wild
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 12, Problem 7QS
Summary Introduction
Concept Introduction:
The statement of cash flows is one of the four financial statements; income statement, balance sheet, statement of owner’s equity, and statement of cash flows. The statement of cash flows is prepared to know the cash flow position of the business. The statement shows cash flows under three different types of business activities; operating activities, investing activities, and financing activities.
To calculate:the cash received from sale of furniture.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The following information is from Ellerby Company’s comparative balance sheets. The current-year income statement reports depreciation expense on furniture of $18,000. During the year, furniture costing $52,500 was sold for its book value. Compute cash received from the sale of furniture.
The following information is from Ellerby Company’s comparative balance sheets.
At December 31
Current Year
Prior Year
Furniture
$
132,000
$
184,500
Accumulated depreciation—Furniture
(88,700
)
(110,700
)
The current-year income statement reports depreciation expense on furniture of $18,000. During the year, furniture costing $52,500 was sold for its book value on December 31, Current Year. Complete the general ledger accounts to calculate cash received from the sale of furniture.
The comparative balance sheet of Yellow Dog Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows:
Please see the attachment for details:
Additional data obtained from the income statement and from an examination of the accounts in the ledger for 20Y8 are as follows:a. Net income, $190,000.b. Depreciation reported on the income statement, $115,000.c. Equipment was purchased at a cost of $395,000, and fully depreciated equipment costing $75,000 was discarded, with no salvage realized.d. The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty.e. 40,000 shares of common stock were issued at $15 for cash.f. Cash dividends declared and paid, $50,000.
InstructionsPrepare a statement of cash flows, using the indirect method.
Chapter 12 Solutions
Loose Leaf for Financial Accounting: Information for Decisions
Ch. 12 - What is the reporting purpose of the statement of...Ch. 12 - Prob. 2DQCh. 12 - Prob. 3DQCh. 12 - Describe the direct method of reporting cash flows...Ch. 12 - Prob. 5DQCh. 12 - Prob. 6DQCh. 12 - Prob. 7DQCh. 12 - Prob. 8DQCh. 12 - Prob. 9DQCh. 12 - Prob. 10DQ
Ch. 12 - Prob. 11DQCh. 12 - Prob. 12DQCh. 12 - Prob. 13DQCh. 12 - Prob. 14DQCh. 12 - Prob. 15DQCh. 12 - Prob. 1QSCh. 12 - Prob. 2QSCh. 12 - Prob. 3QSCh. 12 - Prob. 4QSCh. 12 - Prob. 5QSCh. 12 - Prob. 6QSCh. 12 - Prob. 7QSCh. 12 - Prob. 8QSCh. 12 - Prob. 9QSCh. 12 - Prob. 10QSCh. 12 - Prob. 11QSCh. 12 - Prob. 12QSCh. 12 - Prob. 13QSCh. 12 - Refer to the data in QS 12-11. How much cash is...Ch. 12 - Prob. 15QSCh. 12 - Prob. 16QSCh. 12 - Prob. 17QSCh. 12 - Prob. 18QSCh. 12 - Prob. 19QSCh. 12 - Prob. 21QSCh. 12 - The following transactions and events occurred...Ch. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4ECh. 12 - Prob. 5ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Prob. 8ECh. 12 - Prob. 9ECh. 12 - Prob. 10ECh. 12 - Prob. 11ECh. 12 - Prob. 12ECh. 12 - Prob. 13ECh. 12 - Prob. 14ECh. 12 - Prob. 15ECh. 12 - Prob. 16ECh. 12 - Prob. 17ECh. 12 - Prob. 18ECh. 12 - Prob. 19ECh. 12 - Prob. 1PSACh. 12 - Prob. 2PSACh. 12 - Prob. 3PSACh. 12 - Prob. 4PSACh. 12 - Prob. 5PSACh. 12 - Golden Corp., a merchandiser, recently completed...Ch. 12 - Prob. 7PSACh. 12 - Prob. 8PSACh. 12 - Prob. 1PSBCh. 12 - Prob. 2PSBCh. 12 - Prob. 3PSBCh. 12 - Prob. 4PSBCh. 12 - Prob. 5PSBCh. 12 - Prob. 6PSBCh. 12 - Prob. 7PSBCh. 12 - Prob. 8PSBCh. 12 - Prob. 12SPCh. 12 - Prob. 1FSACh. 12 - Prob. 2FSACh. 12 - Prob. 3FSACh. 12 - Prob. 1BTNCh. 12 - Prob. 2BTNCh. 12 - Prob. 4BTNCh. 12 - Prob. 6BTN
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
- Jada Company had the following transactions during the year: Purchased a machine for $500,000 using a long-term note to finance it Paid $500 for ordinary repair Purchased a patent for $45,000 cash Paid $200,000 cash for addition to an existing building Paid $60,000 for monthly salaries Paid $250 for routine maintenance on equipment Paid $10,000 for major repairs Depreciation expense recorded for the year is $25,000 If all transactions were recorded properly, what is the amount of increase to the Property, Plant, and Equipment section of Jadas balance sheet resulting from this years transactions? What amount did Jada report on the income statement for expenses for the year?arrow_forwardThe comparative balance sheet of Prime Sports Gear, Inc., at December 31, the end of the fiscal year, is as follows: Additional data obtained from the records of Prime Sports Gear are as follows: a. Net income for 2013 was 121,610. b. Depreciation reported on income statement for 2013 was 46,500. c. Purchased 165,000 of new equipment, putting 90,000 cash down and issuing 75,000 of bonds for the balance. d. Old equipment originally costing 19,500, with accumulated depreciation of 7,950, was sold for 8,000. e. Retired 60,000 of bonds. f. Declared cash dividends of 64,000. g. Issued 1,500 shares of common stock at 27 cash per share. Open the file CASHFLOW from the website for this book at cengagebrain.com. First, enter the formulas. Then, complete the worksheet in the manner described next. According to the problem, cash increased from 39,600 to 67,210 during the year. This is a 27,610 increase. To record this increase on the worksheet, move to row 17. Since this is the first account you are analyzing, enter the letter a in column C. Then enter 27610 in column D (a debit since cash increased). This brings the year-end balance (column G) to 67,210, its proper balance. Now move to the bottom part of the statement where you see the categories Operating Activities, Investing Activities, and so on. The credit side of the entry has to be entered here. The proper space for this cash entry is on row 59. Enter the letter a in cell E59 and 27610 in cell F59. Notice the totals at the bottom of the page (row 60) now agree. The next account balance that changed is accounts receivable. It increased by 9,035. To enter this change on the worksheet, enter the letter b in cell C18 and 9035 in cell D18 (again, a debit since accounts receivable increased). This brings the year-end balance in column G to 121,250, its proper balance. The change in accounts receivable balance is an operating activity adjustment (as explained in your textbook). Enter the credit side of this entry in cells E34 and F34, and enter the explanation Increase in accounts receivable in cell A34. Note: Your textbook probably shows Net income as the first item under Operating Activities. We will get to that later. The sequence in which you enter items on this worksheet is not important. All other balance sheet accounts must be analyzed in the same manner, placing appropriate debit or credit entries in the top part of the worksheet to obtain the proper balances in column G, and then entering the second side of the entry in the appropriate row on the bottom part of the worksheet. You should use letter references to identify all entries. Also, you must enter a description of the entry in column A under the appropriate activity category. Although a sequence of analyzing the balance sheet from top to bottom is suggested here, this order is not necessary. As mentioned earlier, your textbook may specify a different sequence. Also, note that some accounts may have both debit and credit adjustments to them. The worksheet is not a substitute for a statement of cash flows, but it does provide you with all the numbers you need to properly prepare one. You will be done with your analysis when: a. The individual account balances at December 31, 2013, as shown on the worksheet (column G) equal those shown in the given problem data. b. The transaction column totals are equal (cells D60 and F60). c. The sum of the operating, investing, and financing activities (cell G59) equals the change in cash (cell D59 or F59). When you are finished, enter your name in cell A1. Save your completed file as CASHFLOW2. Print the worksheet when done. Also print your formulas. Check figure: Total credits at 12/31/2013 (cell G31), 860,460.arrow_forwardParra Company completed its income statement and comparative balance sheet for the current year and provided the following information: Income Statement Service revenue $ 66,500 Expenses: Salaries $ 40,000 Depreciation 6,100 Utilities 5,100 Loss on sale of equipment 1,300 52,500 Net income $ 14,000 Partial Balance Sheet Current Year Prior Year Accounts receivable $ 12,900 $ 24,100 Salaries payable 19,100 11,100 Other accrued liabilities 5,800 10,300 Land 51,700 58,600 Present the operating activities section of the statement of cash flows for Parra Company using the indirect method. (List cash outflows as negative amounts.)arrow_forward
- A business had non-current assets with a carrying amount of $50,000 at the start of the financial year. During the year the business sold assets that had cost $4,000 and had been depreciated by $1,500. Depreciation for the year was $9,000. The carrying amount of assets at the end of the financial year was $46,000. How much cash has been invested in non-current assets during the year?arrow_forwardThe income statement, balance sheets, and additional information for Video Phones, Inc., are provided. VIDEO PHONES, INC. Income Statement For the Year Ended December 31, 2021 Net sales $ 3,436,000 Expenses: Cost of goods sold $ 2,250,000 Operating expenses 918,000 Depreciation expense 33,000 Loss on sale of land 8,600 Interest expense 18,000 Income tax expense 54,000 Total expenses 3,281,600 Net income $ 154,400 VIDEO PHONES, INC. Balance Sheets December 31 2021 2020 Assets Current assets: Cash $ 267,160 $ 194,280 Accounts receivable 87,600 66,000 Inventory 105,000 141,000 Prepaid rent 13,440 6,720 Long-term assets: Investments 111,000 0 Land 216,000 252,000 Equipment 282,000 216,000…arrow_forwardThe net income reported on the income statement for the current year was $320,000. Depreciation recorded on equipment and a building amounted to $96,000 for the year. The changes in the balances of current asset and liability accounts from the beginning of the year are as follows: Accounts receivable, decrease, $6,400 Inventories, increase, $24,000 Pre-Paid Expenses, decrease, $1,600 Accounts Payable, decrease, $8,000 Salaries Payable, increase, $2,400 Dividends Payable, increase $4,750 Determine the net cash flows from operating activities.arrow_forward
- The net income reported on the income statement for the current year was $143,700. Depreciation recorded on store equipment for the year amounted to $23,700. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $55,900 $51,430 Accounts receivable (net) 40,080 38,010 Inventories 54,730 57,860 Prepaid expenses 6,150 4,890 Accounts payable (merchandise creditors) 52,380 48,650 Wages payable 28,620 31,780 a. Prepare the “Cash flows from operating activities” section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.arrow_forwardThe income statement, balance sheets, and additional information for Video Phones, Inc., are provided. VIDEO PHONES, INC. Income Statement For the Year Ended December 31, 2021 Net sales $ 3,386,000 Expenses: Cost of goods sold $ 2,200,000 Operating expenses 908,000 Depreciation expense 32,000 Loss on sale of land 8,500 Interest expense 17,500 Income tax expense 53,000 Total expenses 3,219,000 Net income $ 167,000 VIDEO PHONES, INC. Balance Sheets December 31 2021 2020 Assets Current assets: Cash $ 270,300 $ 185,900 Accounts receivable 86,500 65,000 Inventory 105,000 140,000 Prepaid rent 13,200 6,600 Long-term assets: Investments 110,000 0 Land 215,000 250,000 Equipment 280,000 215,000…arrow_forwardThe net income reported on the income statement for the current year was $210,000. Depreciation recorded on equipment and a building amount to $62,500 for the year. Balances of the current asset and current liabilities accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $56,000 $59,500 Accounts receivable (net) 71,000 73,400 Inventories 140,000 126,500 Prepaid expenses 7,800 8,400 Accounts payable (merchandise creditors) 62,600 66,400 Salaries payable 9,000 8,250 Required: a. Prepare the cash flows from operating activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. Operating Activities Section Cash flows from operating activities: Net income $fill in the blank 5fff63fd0fdcfac_2 Adjustments to reconcile net income to net cash flow from operating activities:…arrow_forward
- The net income reported on the income statement for the current year was $210,000. Depreciation recorded on equipment and a building amount to $62,500 for the year. Balances of the current asset and current liabilities accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $56,000 $59,500 Accounts receivable (net) 71,000 73,400 Inventories 140,000 126,500 Prepaid expenses 7,800 8,400 Accounts payable (merchandise creditors) 62,600 66,400 Salaries payable 9,000 8,250 Required: a. Prepare the cash flows from operating activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. Operating Activities Section Cash flows from operating activities: $ Adjustments to reconcile net income to net cash flow from operating activities: Changes in current operating…arrow_forwardThe net income reported on the income statement for the current year was $262,100. Depreciation recorded on equipment and a building amounted to $78,400 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $71,030 $75,290 Accounts receivable (net) 90,070 92,910 Inventories 177,580 160,070 Prepaid expenses 9,870 10,620 Accounts payable (merchandise creditors) 79,340 84,020 Salaries payable 11,440 10,470 a. Prepare the "Cash Flows from Operating Activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.arrow_forwardThe net income reported on the income statement for the current year was $312,900. Depreciation recorded on equipment and a building amounted to $93,600 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $81,040 $85,090 Accounts receivable (net) 102,760 105,000 Inventories 202,600 180,900 Prepaid expenses 11,260 12,000 Accounts payable (merchandise creditors) 90,520 94,960 Salaries payable 13,050 11,830 Question Content Area A. Prepare the "Cash Flows from Operating Activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. B. If the direct method had been used, would the net cash flow from operating activities have been the same? yes or noarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax College
Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage Learning
Financial AccountingAccountingISBN:9781337272124Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Financial Accounting
Accounting
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Cengage Learning
Financial Accounting
Accounting
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
7.2 Ch 7: Notes Payable and Interest, Revenue recognition explained; Author: Accounting Prof - making it easy, The finance storyteller;https://www.youtube.com/watch?v=wMC3wCdPnRg;License: Standard YouTube License, CC-BY