GOLDEN CORPORATION Comparative Balance Sheets December 31, 2016 and 2015 2016 20

Question

GOLDEN CORPORATION Comparative Balance Sheets December 31, 2016 and 2015 2016 2015 Assets Cash Accounts receivable Inventory Total current assets Equipment Accum. depreciation-Equipment Total assets $209,000 $150,000 76,000 538,000 764,000 323,000 177,000)(116,000 $1,110,000 $ 971,000 89,000 625,000 923,000 364,000 Liabilities and Equity Accounts payable Income taxes payable Total current liabilities Equity Common stock, $2 par value Paid-in capital in excess of par value, common stock Retained earnings Total liabilities and equity $ 91,000$ 83,000 37,000 120,000 46,000 137,000 614,000 592,000 172,000 87,000 $1,110,000$ 971,000 205,000 154,000

Explanation / Answer

Statement of Cash Flows under Indirect Method: Particulars Amount ($) Cash Flow from operating Activities: Net Income 163000 Add: Loss on sale of investments Add: Depreciation 61000 Add: Loss on sale of machinery Less: Gain on sale of Investments Add: Income Tax Expense 24000 Cash from operating activities before working capital adjustments 248000 Working Capital Adjustments: Increase in Accounts Receivable (89000-76000) -13000 Increase in Inventory (625000-538000) -87000 Increase in Accounts Payable (91000-83000) 8000 Cash Flow from Operating activities before Taxes 156000 Less: Taxes (37000+24000-46000) 15000 Cash Flow from operating activities 141000 Cash Flow from Investing Activities: Sale of Equity investments Sales of Machinery Purchase of Equipment -41000 -41000 Cash Flow from financing activities: Dividend paid -96000 Issue of Common Stock (11000*5) 55000 -41000 Cash Flow during the year 59000 Beginning Cash Balance 150000 Ending Cash Balance 209000

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