XS Supply Company is developing its annual financial statements at December 31.

Question

XS Supply Company is developing its annual financial statements at December 31. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized: Current Year Previous Year Balance Sheet at December 31 Cash Accounts Receivable Inventory Equipment Accumulated Depreciation-Equipment $ 32,090 27,000 27,100 37,100 91,000 (28,200) (24,100) 33,200 39,200 107,500 $183,790 $158,100 Accounts Payable Salaries and Wages Payable Note Payable (long-term) Common Stock Retained Earnings 34,200 26,100 1,200 35,000 71,700 24,100 1,090 29,900 83,200 35,400 $183,790 $158,100 Income Statement Sales Revenue Cost of Goods Sold Other Expenses 111,000 65,500 34,200 Net Income 11,300

Explanation / Answer

Answer:

XS Supply Company Statement of cash Flows For the year ended December 31 Cash flow from operating activities: Net income 11300 Adjustment to reconcile Net income to Net cash Provided by operating activities: Depreciation expense 7100 Incraese in accounts receivable -6100 Increase in inventory -2100 Increase in accounts Payable 8100 Decrease in salaries and wages Payable -110 6890 Net cash Provided by operating activities 18190 Cash Flow from investing activities: Purchase Equipment -8900 Cash Flow used in investing activities -8900 Cash Flows From financing activities: Long term notes Payable -12000 Issue Common stock 11500 Cash Dividend Paid -3700 Net cash flow provided by financing activities -4200 Net increase or decrease in cash 5090 Opening cash 27000 Closing cash 32090

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