Using the financial data below, prepare a statement of cash flows for the year e
ID: 2783077 • Letter: U
Question
Using the financial data below, prepare a statement of cash flows for the year ended December 31, 2014 for Summer Peebles, Inc. using the indirect method.
Include the Excel spreadsheet picture with all calculations.
Sales
$1,000.00
Cost of Goods Sold
-$650.00
Depreciation Expense
-$100.00
Sales and General Expense
-$100.00
Interest Expense
-$50.00
Income Tax Expense
-$40.00
Net Income
$60.00
Assets
2013
2014
Cash
$50.00
$60.00
Accounts Receivable, Net
$500.00
$520.00
Inventory
$750.00
$770.00
Current Assets
$1,300.00
$1,350.00
Fixed Assets, Net
$500.00
$550.00
Total Assets
$1,800.00
$1,900.00
Liabilities and Equity
Notes Payable to Banks
$100.00
$75.00
Accounts Payable
$590.00
$615.00
Interest Payable
$10.00
$20.00
Current Liabilities
$700.00
$710.00
Long-Term Debt
$300.00
$350.00
Deferred Income Tax
$300.00
$310.00
Capital Stock
$400.00
$400.00
Summer Peebles, Inc.Income Statement Year Ending December 31, 2014
Sales
$1,000.00
Cost of Goods Sold
-$650.00
Depreciation Expense
-$100.00
Sales and General Expense
-$100.00
Interest Expense
-$50.00
Income Tax Expense
-$40.00
Net Income
$60.00
Explanation / Answer
Statement of Cash Flows AS ON DECEMBER 31 2014 Amount in $ Amount in $ Net income (Net income Less Deferred tax liabiltity $ 10) $ 50.00 Cash flows from operating activities Adjustments for: Depreciation $ 100.00 (Increase) / Decrease in Account receivables $ -20.00 Inventory Decrease / (Increase) $ -20.00 Deffered Tax Liability $ -10.00 Interest Payable $ 10.00 Accounts payable Increase / ( Decrese) $ 25.00 Net cash from operating activities $ 85.00 Cash flows from investing activities Purcahse of Fixed Assets $ -150.00 Net cash used in investing activities $ -150.00 Cash flows from Financing activities Long Term Debt $ 50.00 Note Payable $ -25.00 Net cash used in financing activities $ 25.00 Net increase in cash and cash equivalents $ 10.00 Add :Cash and cash equivalents at beginning of period $ 50.00 Cash and cash equivalents at end of period $ 60.00
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