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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

The financial statements for Zhang Company follow. Assume that the withdrawals were in the form of cash.

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Required

Prepare a statement of cash flows for the year ended December 31, 2018.

Check Figure

Net cash flows used by financing activities, $(90,000)

To determine

Prepare statement of cash flows for Company Z for the year ended December 31, 2018.

Explanation

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 from borrowings and investment by owners, and outflows from payment of debt and withdrawals by owner for personal use.

Prepare statement of cash flows for Company Z for the year ended December 31, 2018.

...
Company Z
Statement of Cash Flows
For the Year Ended December 31, 2018
Cash flows from (used by) operating activities  
 Net income$86,000 

 Add (Deduct) items to convert net income from accrual

 basis to cash basis:

  

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