Week_3_Homework_Answers

Week_3_Homework_Answers - Problem 16-1A (50 minutes) Part 1...

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Problem 16-1A (50 minutes) Part 1 GEORGIA COMPANY Statement of Cash Flows For Year Ended December 31, 2009 Cash flows from operating activities Net income. .................................................................... $120,575 Adjustments to reconcile net income to net cash provided by operating activities: Increase in accounts receivable ($65,840 - $56,000). ...... (9,840) Increase in inventory ($277,000 - $252,000). .................... (25,000) Decrease in prepaid expenses ($1,500 - $1,000). ........... 500 Decrease in accounts payable ($113,000 - $42,965). ...... (70,035) Depreciation expense. ................................................ 20,000 Loss on disposal of equipment. .................................. 5,875 Net cash provided by operating activities. ..................... $ 42,075 Cash flows from investing activities Cash received from sale of equipment. .......................... 11,625 Cash paid for equipment. ............................................... (35,000 ) Net cash used in investing activities. .............................. (23,375) Cash flows from financing activities Cash borrowed on short-term note. ............................... 3,000 Cash paid on long-term note. ......................................... (40,500) Cash received from issuing stock (2,350 x $20). .............. 47,000 Cash paid for dividends. ................................................ (51,900 ) Net cash used in financing activities. ............................. (42,400
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Week_3_Homework_Answers - Problem 16-1A (50 minutes) Part 1...

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