Statement of Cash Flows The following is a list of the items to be included in the preparation of Trone Company’s 2019 statement of cash flows: a. ordinary gain, $9,200 b. proceeds from issuance of note, $25,000 c. decrease in accounts receivable, $5,000 d. payment for purchase of patent, $19,800 e. increase in inventory, $6,700 f. payment of dividends, $30,000 g. decrease in accounts payable, $4,000 h. proceeds from sale of investments, $8,500 i. amortization of premium on bonds payable, $2,100 j. net income, $49,200 k. common stock exchanged for land, $14,000 l. payment for purchase of equipment, $39,400 m. loss on sale of investments, $4,800 n. decrease in deferred taxes payable, $3,600 o. proceeds from issuance of preferred stock, $52,800 p. payment to retire bonds, $37,800 q. depreciation expense, $10,700 r. ending cash balance, $22,100 Required: 1. Prepare the statement of cash flows. 2. Next Level What would have happened if the company had not issued the note during 2019? How did the issuance of the note affect the company’s debt ratio (discussed in Chapter 6) at the end of 2019?

BuyFind

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281
BuyFind

Intermediate Accounting: Reporting...

3rd Edition
James M. Wahlen + 2 others
Publisher: Cengage Learning
ISBN: 9781337788281

Solutions

Chapter
Section
Chapter 21, Problem 4P
Textbook Problem

Statement of Cash Flows The following is a list of the items to be included in the preparation of Trone Company’s 2019 statement of cash flows:

  1. a. ordinary gain, $9,200
  2. b. proceeds from issuance of note, $25,000
  3. c. decrease in accounts receivable, $5,000
  4. d. payment for purchase of patent, $19,800
  5. e. increase in inventory, $6,700
  6. f. payment of dividends, $30,000
  7. g. decrease in accounts payable, $4,000
  8. h. proceeds from sale of investments, $8,500
  9. i. amortization of premium on bonds payable, $2,100
  10. j. net income, $49,200
  11. k. common stock exchanged for land, $14,000
  12. l. payment for purchase of equipment, $39,400
  13. m. loss on sale of investments, $4,800
  14. n. decrease in deferred taxes payable, $3,600
  15. o. proceeds from issuance of preferred stock, $52,800
  16. p. payment to retire bonds, $37,800
  17. q. depreciation expense, $10,700
  18. r. ending cash balance, $22,100

Required:

  1. 1. Prepare the statement of cash flows.
  2. 2. Next Level What would have happened if the company had not issued the note during 2019? How did the issuance of the note affect the company’s debt ratio (discussed in Chapter 6) at the end of 2019?

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Chapter 21 Solutions

Intermediate Accounting: Reporting And Analysis
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