Unit 6 Assignment 2
lakeisha.smithwick
cf_unit6_p12-5_cp12-2.xlsxP12-5
| P12-5 (Supplement B) Preparing a Statement of Cash Flows with Gain on Sale of Equipment (Indirect Method) LO12-2, 12-4, 12-6 | ||
| XS Supply Company is developing its annual financial statements at December 31, 2014. The statements are complete except for the | ||
| statement of cash flows. The completed comparative balance sheets and income statement are summarized: | ||
| 2014 | 2013 | |
| Balance sheet at December 31 | ||
| Cash | $ 34,000 | $ 29,000 |
| Accounts receivable | 35,000 | 28,000 |
| Merchandise inventory | 41,000 | 38,000 |
| Property and equipment | 121,000 | 100,000 |
| Less: Accumulated depreciation | (30,000) | (25,000) |
| $ 201,000 | $ 170,000 | |
| Accounts payable | $ 36,000 | $ 27,000 |
| Wages payable | 1,200 | 1,400 |
| Note payable, long-term | 38,000 | 44,000 |
| Contributed capital | 88,600 | 72,600 |
| Retained earnings | 37,200 | 25,000 |
| $ 201,000 | $ 170,000 | |
| Income statement for 2014 | ||
| Sales | $ 120,000 | |
| Gain on sale of equipment | 1,000 | |
| Cost of goods sold | 70,000 | |
| Other expenses | 38,800 | |
| Net income | $ 12,200 | |
| Additional Data: | ||
| a. | Bought equipment for cash, $31,000. | |
| Sold equipment with original cost of $10,000, accumulated depreciation of $7,000, for $4,000 cash. | ||
| b. | Paid $6,000 on the long-term note payable. | |
| c. | Issued new shares of stock for $16,000 cash. | |
| d. | No dividends were declared or paid. | |
| e. | Other expenses included depreciation, $12,000; wages, $13,000; taxes, $6,000; and other, $7,800. | |
| f. | Accounts payable includes only inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, | |
| assume that these expenses were fully paid in cash. | ||
| Required: | ||
| 1 | Prepare the statement of cash flows for the year ended December 31, 2014, using the indirect method. | |
| (List cash outflows as negative amounts.) | ||
| Possible input areas are shaded. | ||
| XS SUPPLY COMPANY | ||
| Statement of Cash Flows | ||
| For the Year Ended December 31, 2014 | ||
| Cash flows from operating activities: | ||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||
| - | ||
| - | ||
| Cash flows from investing activities: | ||
| - | ||
| Cash flows from financing activities: | ||
| - | ||
| $ - | ||
P12-5 Check Figures
| P12-5 (Supplement B) Preparing a Statement of Cash Flows with Gain on Sale of Equipment (Indirect Method) LO12-2, 12-4, 12-6 | ||
| XS Supply Company is developing its annual financial statements at December 31, 2014. The statements are complete except for the | ||
| statement of cash flows. The completed comparative balance sheets and income statement are summarized: | ||
| 2014 | 2013 | |
| Balance sheet at December 31 | ||
| Cash | $ 34,000 | $ 29,000 |
| Accounts receivable | 35,000 | 28,000 |
| Merchandise inventory | 41,000 | 38,000 |
| Property and equipment | 121,000 | 100,000 |
| Less: Accumulated depreciation | (30,000) | (25,000) |
| $ 201,000 | $ 170,000 | |
| Accounts payable | $ 36,000 | $ 27,000 |
| Wages payable | 1,200 | 1,400 |
| Note payable, long-term | 38,000 | 44,000 |
| Contributed capital | 88,600 | 72,600 |
| Retained earnings | 37,200 | 25,000 |
| $ 201,000 | $ 170,000 | |
| Income statement for 2014 | ||
| Sales | $ 120,000 | |
| Gain on sale of equipment | 1,000 | |
| Cost of goods sold | 70,000 | |
| Other expenses | 38,800 | |
| Net income | $ 12,200 | |
| Additional Data: | ||
| a. | Bought equipment for cash, $31,000. | |
| Sold equipment with original cost of $10,000, accumulated depreciation of $7,000, for $4,000 cash. | ||
| b. | Paid $6,000 on the long-term note payable. | |
| c. | Issued new shares of stock for $16,000 cash. | |
| d. | No dividends were declared or paid. | |
| e. | Other expenses included depreciation, $12,000; wages, $13,000; taxes, $6,000; and other, $7,800. | |
| f. | Accounts payable includes only inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, | |
| assume that these expenses were fully paid in cash. | ||
| Required: | ||
| 1 | Prepare the statement of cash flows for the year ended December 31, 2014, using the indirect method. | |
| (List cash outflows as negative amounts.) | ||
| Possible input areas are shaded. | ||
| XS SUPPLY COMPANY | ||
| Statement of Cash Flows | ||
| For the Year Ended December 31, 2014 | ||
| Cash flows from operating activities: | ||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||
| - | ||
| Net cash provided by operating activities | - | |
| Cash flows from investing activities: | ||
| - | ||
| Cash flows from financing activities: | ||
| - | ||
| $ - | ||
CP12-2
| CP12-2 | Finding Financial Information | LO12-2, 12-4, 12-6 |
| Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. | ||
| Required: | ||
| 1. Does Urban Outfitters use the direct or indirect method to report cash flows from operating activities? | ||
| 2. What amount of tax payments did the company make during the most recent reporting year? | ||
| (Hint: The statement of cash flows may be helpful to answer this question.) | ||
| 3. Explain why the “share-based compensation” and “depreciation and amortization” items were added in | ||
| the reconciliation of net income to net cash provided by operating activities. | ||
| 4. Has the company paid cash dividends during the last three years? | ||
| How do you know? | ||
| 5. What was free cash flow for the year ended January 31, 2012? (Dollars in thousands.) | ||
| Cash Flows from | ||
| Free Cash Flow: | ||
CP12-2 Check Figures
| CP12-2 | Finding Financial Information | LO12-2, 12-4, 12-6 |
| Refer to the financial statements of Urban Outfitters given in Appendix C at the end of this book. | ||
| Required: | ||
| 1. Does Urban Outfitters use the direct or indirect method to report cash flows from operating activities? | ||
| 2. What amount of tax payments did the company make during the most recent reporting year? | ||
| (Hint: The statement of cash flows may be helpful to answer this question.) | ||
| Tax payments of $120,847 thousand were made (located near the bottom of the Statement of Cash Flows). | ||
| 3. Explain why the “share-based compensation” and “depreciation and amortization” items were added in | ||
| the reconciliation of net income to net cash provided by operating activities. | ||
| 4. Has the company paid cash dividends during the last three years? | ||
| How do you know? | ||
| 5. What was free cash flow for the year ended January 31, 2012? (Dollars in thousands.) | ||
| Cash Flows from | ||
| Free Cash Flow: | ||
Sheet2
| List1 | List2 | List3 | List6 |
| Cash balance, December 31, 2014 | Net income | Net cash provided by operating activities | Net increase in cash during the year |
| Cash balance, January 1, 2014 | Net loss | Net cash used in operating activities | Net decrease in cash during the year |
| Cash payments on long-term note | |||
| Cash payments to purchase equipment | |||
| Cash receipts from issuing stock | List4 | ||
| Cash received from sale of equipment | Net cash provided by investing activities | ||
| Decrease in accounts payable | Net cash used in investing activities | ||
| Decrease in accounts receivable | |||
| Decrease in merchandise inventory | |||
| Decrease in wages payable | |||
| Depreciation expense | List5 | ||
| Gain on sale of equipment | Net cash provided by financing activities | ||
| Increase in accounts payable | Net cash used in financing activities | ||
| Increase in accounts receivable | |||
| Increase in merchandise inventory |
