Accounting

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Problem

Fred Slezak presented the following comparative balance sheet:
	FRED SLEZAK CORPORATION
	Comparative Balance Sheet
	December 31, 20X5 and 20X4
		Assets	20X5	20X4
		Current assets
		Cash	$ 664,000	$ 9,000
		Accounts receivable	375,000	345,000
		Inventories	150,000	160,000
		Prepaid expenses	35,000	25,000
		Total current assets	$ 1,224,000	$ 539,000
		Property, plant, & equipment
		Land	$ 300,000	$ 400,000
		Building	700,000	700,000
		Equipment	530,000	450,000
			$ 1,530,000	$ 1,550,000
		Less: Accumulated depreciation	(300,000)	(270,000)
		Total property, plant, & equipment	$ 1,230,000	$ 1,280,000
		Total assets	$ 2,454,000	$ 1,819,000
		Liabilities
		Current liabilities
		Accounts payable	$ 112,000	$ 119,000
		Interest payable	2,000	-
		Total current liabilities	$ 114,000	$ 119,000
		Long-term liabilities
		Long-term note payable	80,000	-
		Total liabilities	$ 194,000	$ 119,000
		Stockholders' equity
		Common stock ($1 par)	$ 700,000	$ 600,000
		Paid-in capital in excess of par	800,000	400,000
		Retained earnings	760,000	700,000
		Total stockholders' equity	$ 2,260,000	$ 1,700,000
		Total liabilities and equity	$ 2,454,000	$ 1,819,000
Additional information about transactions and events occurring in 20X5 follows:
	Dividends of $55,000 were declared and paid.
	Accounts payable and accounts receivable relate solely to purchases and sales of inventory. Prepaid items related only to advertising expenses.
	The decrease in land resulted from the sale of a parcel at a $45,000 loss. No land was purchased during the year. Equipment was purchased during the year in exchange for a promissory note payable. No equipment was sold.
	The increase in paid-in capital resulted from issuing additional shares for cash.
	The income statement for the year ending December 31, 20X5, included the following key amounts:
		Sales	$ 2,000,000
		Cost of goods sold	1,200,000
		Salaries expense	400,000
		Advertising expense	150,000
		Depreciation expense	30,000
		Utilities expense	15,000
		Interest expense	5,000
		Loss on sale of land	45,000
		Income tax expense	40,000
		Net income	115,000
Prepare Fred Slezak's statement of cash flows for the year ending 20X5. Use the indirect approach, and include required supplemental information about cash paid for interest and taxes.

&R&"Myriad Web Pro,Bold"&20I-16.03

I-16.03

Worksheet


FRED SLEZAK CORPORATION
Statement of Cash Flows
For the Year Ending December 31, 20X5
Cash flows from operating activities:
			$ -
		$ -
		-
		-
		-
		-
		-
		-	-
			$ -
Cash flows from investing activities:
		$ -
			-
Cash flows from financing activities:
		$ -
		-
			-
Net increase in cash			$ -
Cash balance at January 1, 20X5			9,000
Cash balance at December 31, 20X5			$ -
	-----------------
Noncash investing/financing activities:
			$ -
	-----------------
Supplemental information:
			$ -
			-

&L&"Myriad Web Pro,Bold"&12Name: Date: Section: &R&"Myriad Web Pro,Bold"&20I-16.03

I-16.03