Question 29 Sheridan\'s Custom Clothing (SCC) sells branded clothing to resorts

ID: 2414286 • Letter: Q

Question

Question 29 Sheridan's Custom Clothing (SCC) sells branded clothing to resorts and corporations. The company's financial statements are presented below SHERIDAN'S CUSTOM CLOTHING STATEMENT OF FINANCIAL POSITION December 31 Current Assets 2017 2016 Cash Accounts receivable Merchandise inventory Prepaid expenses Total current assets 162,000 74,900 24,100 46,100 2,800 276,100 147,900 31,000 73,000 10,100 Property and equipment Property and equipment Less: Accumulated depreciation Net property and equipment 92,000 137,000 76,700 37,500 6300 $313,600 $208,200 54,500 TOTAL ASSETS Current liabilities Accounts payable Salaries payable Interest payable Total current liabilities Loan payable 24,500 8,900 5,300 30,400 5,200 8,100 38,700 437 122,000 93,000

Explanation / Answer

Cash From Operating Activities:-

Net Income

75225

Adjustments:-

Loss on sale of Equipment

7800

Depreciation Exp

9000

Increase A/c Receivable

-6900

Increase Inventory

-26900

Increase Prepaid Exp

-7300

Decrease A/c Payable

-5900

Increase Salary payable

3700

Decrease Int payable

-2800

Cash From Operating Activities (A)

45925

Cash From Investing Activities:-

Cash paid for Equipment

-26000

Sale Equipment

39000

Cash From Investing Activities (B)

13000

Cash From Financing Activities:-

Loan Payable Increase 29000

29000

Issue Common stock (18200 - 7000)

11200

Dividend Paid

-12025

Cash From Financing Activities (C)

28175

Net Cash Flow (A+B+C)

87100

(+) Begnning cash balance

74900

Ending Cash Balance

162000

Non cash activity:-

Equipment Purchase & common stock issue

7000