A comparative balance sheet and income statement is shown for Cruz, Inc. CRUZ, INC. Comparative Balance…
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Question “A comparative balance sheet and income statement is shown for Cruz, Inc. CRUZ, INC. Comparative Balance…”
A comparative balance sheet and income statement is shown for
Cruz, Inc.
CRUZ, INC.
Comparative Balance Sheets
December 31, 2017
2017
2016
Assets
Cash
$
82,800
$
20,600
Accounts receivable, net
35,500
43,700
Inventory
74,300
82,000
Prepaid expenses
4,600
3,700
Total current assets
197,200
150,000
Furniture
92,800
104,800
Accum. depreciation—Furniture
(14,400
)
(8,000
)
Total assets
$
275,600
$
246,800
Liabilities and Equity
Accounts payable
$
13,000
$
18,200
Wages payable
7,700
4,300
Income taxes payable
1,300
2,400
Total current liabilities
22,000
24,900
Notes payable (long-term)
26,800
63,700
Total liabilities
48,800
88,600
Equity
Common stock, $5 par value
198,800
155,300
Retained earnings
28,000
2,900
Total liabilities and equity
$
275,600
$
246,800
CRUZ, INC.
Income Statement
For Year Ended December 31, 2017
Sales
$
422,500
Cost of goods sold
271,900
Gross profit
150,600
Operating expenses
Depreciation expense
$
32,500
Other expenses
77,100
109,600
Income before taxes
41,000
Income taxes expense
14,900
Net income
$
26,100
QS 16-11 Indirect: Computing cash from operations LO P2
Required:
Use the indirect method to prepare the cash provided or used from
operating activities section only of the statement of cash flows
for this company.
Answer
CRUZ INC. Cash flows of Operating Activities: Adjustments for: Depreciation Operating Cashflow before changes to Working Capital Chnages in Working capital Decreases in Accounts Receivables Increase in Prepaid expenses Increase in Wages payable Decreases in Income taxes payable Net Cashflow from operating activities Amount S 26,100 s 32,500 s 58,600 8,200 7,700 (900), (5,200), 3,400 s (1,100 s 12,100 s 70,700
Working Notes Payment of income taxes to 2,400 1,100
Conclusion
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