Some recent financial statements for Smolira Golf Corp. follow. Prepare the 2015

ID: 2607326 • Letter: S

Question

Some recent financial statements for Smolira Golf Corp. follow.

Prepare the 2015 statement of cash flows for Smolira Golf Corp. (Negative amounts should be indicated by a minus sign.)

Some recent financial statements for Smolira Golf Corp. follow SMOLIRA GOLF CORP 2014 and 2015 Balance Sheets Assets Liabilities and Owners' Equity 2014 2015 2014 2015 Current assets Current liabilities Cash Accounts receivable Inventory $ 24,206 14,048 27,622 $ 25,700 16,800 28,700 Accounts payable Notes payable Other $ 24,784 13,000 13,171 $ 28,700 12,400 15,900 $ 65,876 $ 71,200 $ 50,955 $ 57,000 Long-term debt Owners' equity $ 85,000 $ 95,000 Common stock and paid-in surplus Accumulated retained earnings 40,000 230,616 $ 40,000 241,000 Fixed assets Net plant and equipment $340,695 $361,800 Total $270,616 $281,000 Total assets $406,571 $433,000 Total liabilities and owners' equity $406,571 $433,000 SMOLIRA GOLF CORP 2015 Income Statement Sales Cost of goods sold Depreciation $369,230 260,500 47,350 Earnings before interest and taxes Interest paid $ 61,380 15,900 Taxable income Taxes (20%) $ 45,480 9,096 Net income $ 36,384 Dividends Retained earnings $26,000 10,384

Explanation / Answer

Answer

Cash, beginning of the year (A)

24206

Operating Activities

Net Income

36384

Add: Interest expenses

15900

Add: Depreciation

47350

Less: Increase in Accounts receivables

-2752

Less: Increase in Inventory

-1078

Add: Increase in current liabilities

6045

Net Cash from Operating Activities (B)

101849

Investment activities

Purchase of assets*

-68455

Net cash from Investment activities (C)

-68455

Financing activities

Long term debts

10000

Dividend paid

-26000

Interest expense

-15900

Net cash from Financing activities (D)

-31900

Net Increase in cash (E=B+C+D)

1494

Cash, end of year (A+E)

25700

=340695 – 361800 – 47350 = $68455 (Purchased).

Same can be found by preparing Assets T Account.