ACCT 301A Exercise 5 16.docx - EXERCISE 5-16(2025 minutes(a Shabbona Corporation Statement of Cash Flows For the Year Ended Cash flows from operating

ACCT 301A Exercise 5 16.docx - EXERCISE 5-16(2025 minutes(a...

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EXERCISE 5-16 (20–25 minutes) (a) Shabbona Corporation Statement of Cash Flows For the Year Ended December 31, 2017 Cash flows from operating activities Net income ............................................................... $125,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense ($69,000 - $42, 000) ...... $27,000 Increase in accounts receivable ...................... (16,000) Decrease in inventory ....................................... 9,000 Decrease in accounts payable ......................... (13,000 ) 7,000 Net cash provided by operating activities ............ 132,000 Cash flows from investing activities Sale of land .............................................................. 39,000 Purchase of equipment ........................................... (60,000 ) Net cash used by investing activities .................... (21,000) Cash flows from financing activities Payment of cash dividends .................................... (60,000 ) Net increase in cash ...................................................... 51,000 Cash at beginning of year ............................................
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