Final Exam Exercise 5-16 - Exercise 5-16 A comparative...

Exercise 5-16
A comparative balance sheet for Shabbona Corporation is presented below.
December 31
Assets 2014 2013
Cash $ 73,000 $ 22,000
Accounts receivable 82,000 66,000
Inventory 180,000 189,000
Land 71,000 110,000
Equipment 260,000 200,000
Accumulated Depreciation-Equipment (69,000 ) (42,000 )
Total $597,000 $545,000
Liabilities and Stockholders' Equity
Accounts payable $ 34,000 $ 47,000
Bonds payable 150,000 200,000
Common stock ($1 par) 214,000 164,000
Retained earnings 199,000 134,000
Total $597,000 $545,000
Additional information:
1
.
Net income for 2014 was $125,000.
2
.
Cash dividends of $60,000 were declared and paid.
3
.
Bonds payable amounting to $50,000 were retired through issuance of common stock.
Your answer is correct.
Prepare a statement of cash flows for 2014 for Shabbona Corporation. (Show amounts that
decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Shabbona Corporation
Statement of Cash Flows
For the Year Ended December 31, 2014
Cash Flows from Operating Activities
Net Income
$
125,000
Adjustments to reconcile net income to
Net Cash Provided by Operating Activities