Ravenna Company is a merchandiser that uses the indirect method to prepare the o
ID: 2532757 • Letter: R
Question
Ravenna Company is a merchandiser that uses the indirect method to prepare the operating activities section of its statement of cash flows. Its balance sheet for this year is as follows:
During the year, Ravenna paid a $14,100 cash dividend and it sold a piece of equipment for $7,050 that had originally cost $16,800 and had accumulated depreciation of $11,200. The company did not retire any bonds or repurchase any of its own common stock during the year.
l. What is the amount of net cash provided by (used in) operating activities in the company’s statement of cash flows?
m.What is the amount of gross cash outflows reported in the investing section of the company’s statement of cash flows?
n.What is the company’s net cash provided by (used in) investing activities?
o.What is the amount of gross cash inflows reported in the financing section of the company’s statement of cash flows?
p.What is the company’s net cash provided by (used in) financing activities?
Ending Balance Beginning Balance Cash $ 121,800 $ 146,550 Accounts receivable 95,900 103,400 Inventory 128,800 117,500 Total current assets 346,500 367,450 Property, plant, and equipment 339,000 329,000 Less accumulated depreciation 113,000 82,250 Net property, plant, and equipment 226,000 246,750 Total assets $ 572,500 $ 614,200 Accounts payable $ 75,200 $ 133,500 Income taxes payable 58,300 80,200 Bonds payable 141,000 117,500 Common stock 164,500 141,000 Retained earnings 133,500 142,000 Total liabilities and stockholders’ equity $ 572,500 $ 614,200Explanation / Answer
Cash flow indirect method Cash flow from operating activities Net income 5600 Adjustments to reconcile the net income Depreciation expense 41950 Gain on sale of equipment -1450 Changes in current asset and liabilities decrease in accounts receivable 7500 Increase in Inventory -11300 decrease in accounts payable -58300 Decrease in income tax payable -21900 -43500 Cash flow from operating activities -37900 Cash flow from Investing activities Equipment sold 7050 Equipment purchased -26800 Cash flow from Investing activities -19750 Cash flow from Financing activities Bonds payable 23500 Common stock 23500 Additional paid in capital Dividend paid -14100 Treasury stock Cash flow from Financing activities 32900 Net Cash and cash equivalent -24750 Add Beginning cash and cash equivalent 146550 Ending cash and cash equivalent 121800
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.