5) MC Qu. 67 Swinger Corporations comparative ... Swinger Corporation\'s compara
ID: 2576913 • Letter: 5
Question
5) MC Qu. 67 Swinger Corporations comparative ...
Swinger Corporation's comparative balance sheet appears below:
Ending Balance
Beginning Balance
Assets:
Current assets:
Cash and cash equivalents
$47,000
$31,000
Accounts receivable
23,000
22,000
Inventory
66,000
64,000
Total current assets
136,000
117,000
Property, plant, and equipment
356,000
338,000
Less accumulated depreciation
184,000
161,000
Net property, plant, and equipment
172,000
177,000
Total assets
$308,000
$294,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
$17,000
$16,000
Accrued liabilities
43,000
44,000
Income taxes payable
63,000
61,000
Total current liabilities
123,000
121,000
Bonds payable
83,000
80,000
Total liabilities
206,000
201,000
Stockholders' equity:
Common stock
27,000
24,000
Retained earnings
75,000
69,000
Total stockholders' equity
102,000
93,000
Total liabilities and stockholders' equity
$308,000
$294,000
The company did not dispose of any property, plant, and equipment during the year. Its net income for the year was $10,000. The net cash provided by operating activities is:
A)$36,000
B)$32,000
C)$28,000
D)$34,000
Ending Balance
Beginning Balance
Assets:
Current assets:
Cash and cash equivalents
$47,000
$31,000
Accounts receivable
23,000
22,000
Inventory
66,000
64,000
Total current assets
136,000
117,000
Property, plant, and equipment
356,000
338,000
Less accumulated depreciation
184,000
161,000
Net property, plant, and equipment
172,000
177,000
Total assets
$308,000
$294,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable
$17,000
$16,000
Accrued liabilities
43,000
44,000
Income taxes payable
63,000
61,000
Total current liabilities
123,000
121,000
Bonds payable
83,000
80,000
Total liabilities
206,000
201,000
Stockholders' equity:
Common stock
27,000
24,000
Retained earnings
75,000
69,000
Total stockholders' equity
102,000
93,000
Total liabilities and stockholders' equity
$308,000
$294,000
Explanation / Answer
Statement of Cash Flows (partial) Net income 10000 Adjustments to convert net income to a cash basis: Depreciation 23000 Increase in accounts receivable -1000 Increase in inventory -2000 Increase in accounts payable 1000 Decrease in accrued liabilities -1000 Increase in income taxes payable 2000 22000 Net cash provided by operating activities 32000 Option B is correct
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