ORIE_3150_HW_8_ans_Spring_2009 - ORIE 3150 Homework #8...

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ORIE 3150 Homework #8 Spring 2009 1. Construct a complete statement of cash flows for Newman Company, using the indirect method. Newman Company Statement of Cash Flows Year Ended Dec. 31, 2006 Cash from Operations Net Income $34,000 Depreciation Expense 15,500 Gain on Sale of Equipment (2,000) Net Cash Flow from Operations $47,500 Cash from Investing Sale of Equipment $8,500 Net Cash Flow from Investing $8,500 Cash from Financing None $0 Total Cash Flow $56,000 Cash, Dec. 31, 2005 20,000 Plus: Net Cash Flow 56,000 Cash, Dec. 31, 2006 76,000
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2. Bobmart Company has the following annual and year-ending data: Year: 2005 Year: 2004 Net Sales 1,826,235 2,061,787 Cost of Goods Sold 955,796 1,001,975 Salaries Expense 303,309 348,031 Salaries Payable 32,480 21,392 Inventory 498,222 573,848 Accounts Payable 170,434 192,417 Cash 156,974 172,386 Accounts Receivable 348,031 392,920 Find the cash payments for purchases, the cash collected from customers, and the cash salaries paid to employees for Bobmart for fiscal 2005. Cash Payments for Purchases = CGS + ΔInventory – ΔA/P CPFP = 955,796 + (498,222 – 573,848) – (170,434 – 192,417) = $902,153 Cash Collected from Customers = Net Sales – ΔA/R CCFC = 1,826,235 – (348,031 – 392,920) = $1,871,124 Cash Payments for Salaries = Salaries Expense – ΔSalaries Payable CPFS = 303,309 – (32,480 – 21,392) = $292,221
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3. Joyful Elf Company purchased 1,000 shares of Traskar Inc. for $20 per share on
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This note was uploaded on 04/19/2009 for the course ORIE 315 taught by Professor Callister during the Spring '08 term at Cornell University (Engineering School).

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ORIE_3150_HW_8_ans_Spring_2009 - ORIE 3150 Homework #8...

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