Exercise 13-9 Rodriquez Corporation\'s comparative balance sheets are presented

Question

Exercise 13-9 Rodriquez Corporation's comparative balance sheets are presented belovw RODRIQUEZ CORPORATION December 31 e Balance Sheets 2017 $16,800 25,400 19,750 60,050 2016 $17,600 Cash Accounts receivable Investments Equipment Accumulated depreciation-equip 22,100 16,250 69,950 (13,75010,400) ment Total $108,250 $115,500 Accounts payable Bonds payable Common stock Retained earnings $14,650 10,000 50,300 33,300 $108,250 $11,250 30,100 44,600 29,550 $115,500 Total Additional information: 1. Net income was $18,750. Dividends declared and paid were $15,000 2. Equipment which cost $9,900 and had accumulated depreciation of $1,600 was sold for $3,800 3. No noncash investing and financing activities occurred during 2017

Explanation / Answer

STATEMENT OF CASH FLOW: Cash flow as per Operating Activities: Amount $ Net Income 18750 Add: Loss on sale of equipment(9900-1600-3800) 4500 Add: Depreciation 4950 Less: Increase in AR(25400-22100) -3300 Add: increase in AP 3400 Cash inflow as per Operating activities 28300 Cash flow as per Investing Activites: Less: Increase in investments -3500 Add: Sale of equipment 3800 Cash inflow as per Investing Activites 300 Cash flow as per Financing Activities: Less:decrease in Bond payable -20100 Less: dividend paid -15000 Add: Increase in CS 5700 Cash outflow as per Financing Activities -29400 Total cash inflow of all activities -800 Opening cash balance 17600 Closing cash balance $16800

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