Prepare the 2018 statement of cash flows for Smolira Golf Corp. (A negative answer should be…
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Question “Prepare the 2018 statement of cash flows for Smolira Golf Corp. (A negative answer should be…”
Prepare the 2018 statement of cash flows for Smolira Golf Corp. (A negative answer should be indicated by a minus sign.) Some recent financial statements for Smolira Golf Corp. follow. Assets 2017 2018 Current assets Cash Accounts receivable Inventory $ 34,385 17.801 36,310 SMOLIRA GOLF CORP 2017 and 2018 Balance Sheets Liabilities and Owners’ Equity 2018 2017 Current liabilities $ 37,837 Accounts payable $36,722 27.766 Notes payable 19,008 42,632 Other 19,864 $108.235 Total $ 75,594 Long-term debt $115.000 $ 42,582 16,200 24,634 Total $ 88,496 $ 83,416 $145,000 Owners’ equity Common stock and paid-in surplus Accumulated retained earings $ 55,000 307 217 $ 55,000 344452 $464,315 $519,633 Net plant and equipment Total $362.217 $399,452 Total assets $ 552,811 $627 868 $627.868 Total liabilities and owners’ equity $ 552,811 SMOLIRA GOLF CORP 2018 Income Statement Sales Cost of goods sold Depreciation $506,454 359,328 44,463 Earnings before interest and taxes Interest paid $102,663 19,683 Taxable income Taxes (25%) $ 82,980 20,745 Net income $ 62,235 Dividends $25,000
Common stock and paid Accumulated retained e $464,315 Net plant and equipment $519,633 Total Total assets $552,811 $627.868 Total liabilities and owners SMOLIRA GOLF CORP. 2018 Income Statement Sales Cost of goods sold Depreciation $506,454 359,328 44.463 Earnings before interest and taxes Interest paid $102,663 19,683 Taxable income Taxes (25%) $ 82,980 20,745 Net income $ 62,235 Dividends Retained earnings $25,000 37 235 Answer should be in this form:
Net income $ x Add: Depreciation Add: Increase in accounts receivable Add: Increase in inventory Add: Increase in accounts payable Add: Increase in other current liabilifts 62,235 44,463 (9,965) (6,322) 5,860 4,770 x $ 101,041 $ >IX Net cash from operating activities Investment activities Fixed asset acquisition Net decrease in cash Net cash from investment activities Financing activities Increase in long-term debt Dividends paid Decrease in notes payable x $ $ 55,318 44,463 -99,781 $ 30,000 -25,000 (2,808) $ 2,192 Net cash from financing activities Net decrease in cash Cash, end of year X $ 24,398 X 37,837 $ . . .
Answer
Solution
Cash flows from operations: | |
Net income | $ 62,235 |
Adjustments to reconcile net earnings to net cash from operations | |
Add: depreciation | $ 44,463 |
Weaker: An increase in accounts receivable | $ (9,965) |
Inventory: Less | $ (6,322) |
Add: Increase in accounts payable | $ 5,860 |
Add: Additional current liabilities | $ 4,770 |
Net cash from operating activities | $ 101,041 |
Cash flows from investments: | |
Acquisition of fixed assets | $ (99,781) |
Net cash from investing activities | $ (99,781) |
The financing of activities generates cash flows. | |
Long-term debt increases | $ 30,000 |
Dividends paid | $ (25,000) |
Notes payable to be reduced | $ (2,808) |
Net cash from financing activities | $ 2,192 |
Cash change during the year | $ 3,452 |
Add: Beinning cash balance | $ 34,385 |
Ending cash balance | $ 37,837 |
Conclusion
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