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question archive Complete the Statement of Cash Flow below using the indirect method

Complete the Statement of Cash Flow below using the indirect method

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Complete the Statement of Cash Flow below using the indirect method.

Statement of Cash Flows for the Year Ended December 31, 2008

 

Net income

 

Adjustments to reconcile Net Income

Operating Activities

Credit card receivables

 

Accounts receivable

 

Inventory

 

Marketable securities

 

Prepaid expenses

 

Accounts payable

 

Accrued expenses payable

 

Income taxes payable

 

Current mortgage payable

 

Depreciation, building

 

Depreciation, furniture and equipment

 

Net adjustments to reconcile Net Income

 

Net cash flow, operating activities

 

Investing Activities

Purchased furniture and equipment

 

Net cash flow, investing activities

 

Financing Activities

Reduced long-term mortgage

 

Cash dividends paid

 

Net cash flow, financing activities

 

Net cash flow increase

 

Cash balance, December 31, 2007

 

Cash balance, December 31, 2008

 

 

 

 

 

Balance Sheet

 

 

 

2007

2008

Assets

Current Assets

Cash

 $4,100 

 $5,200 

Credit card receivables

4,700

5,500

Accounts receivable

1,200

700

Inventory

3,000

3,600

Marketable securities

8,000

7,000

Prepaid expenses

1,200

1,500

Total Current Assets

 $22,200 

 $23,500 

Property, Plant & Equipment

Land

 $30,000 

 $30,000 

Building

150,000

150,000

less: accum. Depr, building

(41,900)

(50,200)

Furniture & equipment

22,700

25,400

less: accum. Depr, furniture & equip.

(15,400)

(19,100)

Total Property, Plant & Equipment

 $145,400 

 $136,100 

Total Assets

 $167,600 

 $159,600 

Liabilities & Stockholders' Equity

Current Liabilities

Account payable

 $6,900 

 $7,000 

Accrued expenses payable

1,400

1,700

Income taxes payable

2,000

1,500

Current portion of mortgage payable

11,500

10,400

Total Current Liabilities

 $21,800 

 $20,600 

Long-term Liabilities

Long-term mortgage payable

100,000

89,600

Total Liabilities

 $121,800 

 $110,200 

Stockholders' Equity

Capital stock, common

23,000

23,000

Retained earnings

22,800

26,400

Total Stockholders' Equity

 $45,800 

 $49,400 

Total Liabilities & Stockholders' Equity

 $167,600 

 $159,600 

 

 

 

 

Income Statement for Year Ended December 31, 2008

Sales revenue

 $204,900 

Operating costs

(173,800)

EBITDA

31,100

Depreciation, building

(8,300)

Depreciation, furniture and equipment

(3,700)

EBIT

 $19,100 

Interest

(10,800)

Operating income

 $8,300 

Income tax

(1,500)

Net Income

 $6,800 

Statement of Retained Earnings

For Year Ended December 31, 2008

Retained earnings, Dec. 31, 2007

 $22,800 

Add: Net income for year 2008

6,800

   Subtotal

 $29,600 

Deduct: Dividends paid in 2008

(3,200)

Retained earnings, Dec. 31, 2008

 $26,400 

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