Please show all work Show all T Accounts if any are used please show those as we

Question

Please show all work Show all T Accounts if any are used please show those as well
Thank you Below please find the condensed financial data for Fairchild Company for 2012 and 2011. Prepare the Statement of Cash Flows using the Indirect Method. FAIRCHILD COMPANY COMPARATIVE BALANCE SHEET As OF DECOMBER 31, 2012 AND 2011 2012 2011 $1,100 $1,800 1,600 (1,200) inventory Plant assets 1,700 Long-term 1,300 1,470 57.160 $6,300 800 $1,200 Accounts payable Accrued labilities Bonds payable Common stock Retained earnings 1,650 1,700 1,900 1,900 $7,150 FAIRCHILD COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2012 $6,900 4,700 Cost of goods sold Gross margirn Selling and administrative expenses930 Income from operations Other revenues and gains 1,270 Gain on sale of investments Income before tax Income tax expense Net income 1,350 $ 810 Additional information: During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2012. Cash dividends were $260 Instructions Prepare a statement of cash flows using the indirect method.

Explanation / Answer

Plant purchased for cash:

Opening balance= 1700

Add: Plant purchased with stock = 70

Calculated closing balance= 1770

Closing balance= 1900

Balance is plant purchased with cash= 1900-1770= 130

Common stock issued for cash:

Closing baance =1900

Less: opening balance= 1700

Less: Shares issued for plant= 70

Shares issued for cash= 130

Proceeds from sale of investments:

Opening balance= 1470

Add: Gain on sale 80

Less; Closing balance= 1300

Proceeds from sale= 250

Cash flow statement Particulars Amount Income before tax 1350 Less: Gain on sale of investments -80 Add: Depreciation 30 Cash flow before working capital changes: 1300 Less: Increase in receivables -450 Add: Increase in inventory 300 Add: Increase in payables 400 Less: Increase in liabilities -50 operating Cash flow before taxes 1500 Less: Taxes paid -540 Cash flow from operations 960 Cash flow from investing activities: Purchase of plant assets -130 Sale of investments 250 Cash flow from investing activities 120 Cash flow from financing activities: Redemption of bonds payable -250 Dividends paid -260 Issue of common stock 130 Cash flow from financing activities -380 Net change in cash 700 Add: Opening cash balance 1100 Closing cash balance 1800

Related Questions

Navigate

• Browse (All)
• Browse P
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.