King Company - Statement of Cash Flows

Accounting II Name: 
Bus 203 - Spring 2015 

Test IV
Section I
50 Points

The balance sheets for King Company showed the following information. Additional information concerning transactions and events during 2014 are presented below:

                                                            King Company 
                                                            Balance Sheet
                                                            ($ in thous)
                                                                                                __December 31 
                                                                                    2014                                       2013
Cash                                                                          $12,700                                  $10,200
Accounts Receivable                                                53,400                                    20,300
Inventory                                                                     25,000                                    29,000
Investments – Trading Securities Net                    14,000                                    13,000
Long Term Investments - Common Stock           460,000                                   315,000
Property, Plant & Equipment                                 266,500                                  150,000
Accumulated Depreciation                                    (35,600)                                 (25,000)
Total Assets                                                  $796,000                               $512,500


Accounts Payable                                                   $16,000                                  $26,500
Other Accrued Liabilities                                          28,000                                    17,000
Dividends Payable                                                    35,000                                       -0-
Bonds Payable                                                         150,000                                  100,000
Preferred Stock                                                        100,000                                    50,000
Additional Paid-Capital – Preferred Stock           200,000                                  100,000
Common Stock                                                         135,000                                  120,000
Retained Earnings                                                  232,000                                    99,000
Treasury Stock                                                         (100,000)                                   -0-
Total Liabilities and Stockholders’ Equity           $796,000                               $512,500

Additional data for 2014:
                                                                        ($ in thous)
1. Net Income for the year,                         $250,000
2. Plant Assets that cost $15,000 were sold for $5,000. The gain of $2,000 on the sale was reported in net income.
3. Dividends declared were $102,000
4. On July 15, 2014, King declared and issued a large stock dividend, the amount at par was $15,000.
5. Recorded an adjusting entry at year end for a $1,000 unrealized gain on Trading securities.
6. King uses the Equity Method of Accounting for Investments in Common Stock. During 2014, King reported $10,000 of equity income.

Instructions: Prepare a Statement of Cash Flows (use the indirect method) for 2014 for the King Company.




Statement of Cash Flows – Account Analysis Worksheet
($ in thous)



King Company
Statement of Cash Flows
For the year ended December 31, 2014

Net Income











Investing Activities






Financing Activities







Net Increase to cash
Cash Balance 12/31/2013
Cash Balance 12/31/2014