1. Tyler Company issued common stock for proceeds of $44,000 during 2017. The co
ID: 2523828 • Letter: 1
Question
1. Tyler Company issued common stock for proceeds of $44,000 during 2017. The company paid dividends of $10,000. The company also issued a long-term note payable for $120,000 in exchange for equipment during the year. The company sold treasury stock that had a cost of $5,000 for $8,000. Compute net cash flows from financing activities.
2. During 2017, Carter Company sold a building with a book value of $175,000 for proceeds of $150,000. The company also sold long-term investments for proceeds of $50,000. The company purchased land and a new building for $320,000 by signing a long-term note payable. No other transactions impacted long-term asset accounts during 2017. Compute net cash flows from investing activities.
3. Saxon Company had net income of $240,000 in 2017. Depreciation expense for the year is $35,000. During the year, Accounts Receivable increased $10,000 and Prepaid Expenses decreased $2,000. The company also sold equipment at a loss of $2,000. Calculate net cash flows from operating activities using the indirect method.
Explanation / Answer
1) Net cash flow from financing activities cash from common stock 44,000 cash dividend paid -10,000 cash from long term note payable 120,000 cash used for repurchase -8,000 Net cash flow from financing activities 146,000 2) net cash flow from investing activities cash from sale of building 150,000 Cash from sale of long term investment 50,000 net cash flow from investing activities 200,000 3) net cash from operating activities net income for the year 240,000 increase in accounts receivable -10,000 decrease in prepaid expense 2,000 loss from sale of Equipment 2,000 net cash from operating activities 234,000
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