I need help creating a Statement of Cash Flows (Indirect Method) from the compar
ID: 2465670 • Letter: I
Question
I need help creating a Statement of Cash Flows (Indirect Method) from the comparative balance sheet below. I tried completing it myself, but I couldn't get things to match up. I know some of the formating got a little messed up when I transferred this from Excel-- sorry about that. The Net Income for 2013 is $131,234.70. Let me know if you need any other information. Thank you!
Comparative Balance Sheet At December 31, 2013 and 2012 Assets Current Assets 2013 2012 Cash 96,555.04 11,025.19 Accounts Receivable (Less allow. for doubtful accts of $3250.81 in 2012 and $2646.25 in 2013) 42,875.75 7,814.19 Accounts Receivable from Employees 300.00 - Marketable Securities 25,280.00 - Inventory 193,306.00 101,681.00 Prepaid Expenses 4,000.00 - Total Current Assets 362,316.79 120,520.38 Long Term Assets - Notes Receivable 8,000.00 - Fixed Assets (Less Accumulated Depreciation of $81,559.50 in 2012 and $115,669 in 2013) 215,921.00 239,105.50 Total Assets 586,237.79 359,625.88 Liabilities And Stockholders Equity Current Liabilities Accounts Payable 8,767.15 11,279.35 Federal Income Taxes Withheld 1,706.65 1,326.76 State Unemployment Taxes Payable 87.93 281.17 Federal Unemployment Taxes Payable 26.05 83.31 F.I.C.A. Taxes Payable 2,236.66 1,593.30 Federal Income Taxes Payable 53,116.40 29,797.00 Dividends Payable 6,750.00 - Interest Payable 197.26 - Notes Payable 70,000.00 - Unearned Revenue 3,600.00 - Total Liabilities 146,488.10 44,360.89 Stockholders Equity Common Stock 225,000.00 225,000.00 Retained Earnings 214,749.69 90,264.99 Total Stockholders Equity 439,749.69 315,264.99 Total Liabilities and Equity 586,237.79 359,625.88Explanation / Answer
Cash Flows (Indirect Method) As on December 31, 2013 All Amounts in $ Cash Flows from Operating Activities Net Income for 2013 131234.7 Add : Depreciation 34109.5 Add : Interest Expense 197.26 Add : Taxation 23319.4 57626.16 Cash Flow before Working Capital changes 188860.9 Less : Increase in Accounts Receivable -35061.6 Less : Increase in Receivables from Employees -300 Less : Increase in Inventories -91625 Less : Increase in Prepaid Expenses -4000 Less : Decrease in Accounts Payable -2512.2 Add : Increase in Federal and Other 772.75 Taxes Payable (Taxes Withheld + Federal IT + State UT + Federal UT + FICA) Add : Increase in Unearned Revenue 3600 -129126 Cash Inflows from Operating Activities 59734.85 Cash Flows from Investing Activities Issue of Marketable Securities -25280 Purchase of Fixed Assets -10925 Interest Payment 0 -36205 Cash Flows from Financing Activities Issue of Notes Receivable -8000 Issue of Notes Payable 70000 Income Tax Payments 0 Dividends Declared 0 62000 Net Increase in Cash/Cash Equivalents during the year 85529.85 Opening Cash/Cash Equivalents 11025.19 Closing Cash/Cash Equivalents 96555.04
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