Shown below are comparative balance sheets for Oriole Company. Oriole Company Co
ID: 2536060 • Letter: S
Question
Shown below are comparative balance sheets for Oriole Company.
Oriole Company
Comparative Balance Sheets
December 31
Assets
2017
2016
$ 80,172
$ 25,938
103,752
89,604
196,893
222,831
94,320
117,900
306,540
235,800
(77,814
)
(37,728
)
$703,863
$654,345
Liabilities and Stockholders’ Equity
$ 45,981
$ 50,697
176,850
235,800
254,664
205,146
226,368
162,702
$703,863
$654,345
Additional information:
Land was sold for its book value.
Prepare a statement of cash flows for 2017 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000, or in parenthesis e.g. (15,000)).
Adjustments to reconcile net income to
Oriole Company
Comparative Balance Sheets
December 31
Assets
2017
2016
Cash$ 80,172
$ 25,938
Accounts receivable103,752
89,604
Inventory196,893
222,831
Land94,320
117,900
Equipment306,540
235,800
Accumulated depreciation—equipment(77,814
)
(37,728
)
Total$703,863
$654,345
Liabilities and Stockholders’ Equity
Accounts payable$ 45,981
$ 50,697
Bonds payable176,850
235,800
Common stock ($1 par)254,664
205,146
Retained earnings226,368
162,702
Total$703,863
$654,345
Explanation / Answer
SOLUTION
Cash flow statement
Amount ($) Amount ($) Cash Flows from Operating Activities Net Income 109,647 Adjustments to reconcile net income to Net Cash Provided by Operating Activities Depreciation Expense 40,086 Increase in Accounts Receivable ($103,752 - $89,604) (14,148) Decrease in Inventory ($222,831 - $196,893) 25,938 Decrease in Accounts Payable ($50,697 - $45,981) (4,716) 47,160 Net Cash Provided by Operating Activities (A) 156,807 Cash Flows from Investing Activities: Sale of Land ($117,900 - $94,320) 23,580 Purchase of Equipment ($306,540 - $235,800) (70,740) Net Cash used by Investing Activities (B) (47,160) Cash Flows from Financing Activities: Issuance of Common Stock 49,518 Payment of Cash Dividends (45,981) Redemption of Bonds (58,950) Net Cash used by Financing Activities (C) (55,413) Net Increase in Cash (A+B+C) 54,234 Cash at Beginning of Period 25,938 Cash at End of Period 80,172Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.