Ch.+12+Problem+Solutions

Ch.+12+Problem+Solutions - Problem 12-1B (40 minutes) Part...

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Problem 12-1B (40 minutes) Part 1 WILSON CORPORATION Statement of Cash Flows For Year Ended December 31, 2009 Cash flows from operating activities Net income . ................................................................................... $116,125 Adjustments to reconcile net income to net cash provided by operating activities Increase in accounts receivable ($65,830 - $55,000) . .......... (10,830) Increase in inventory ($277,000 - $252,000) . ................... (25,000) Decrease in prepaid expenses ($1,600 - $1,250) . ................. 350 Decrease in accounts payable ($112,000 - $55,380) . ........... (56,620) Depreciation expense . ............................................................ 20,000 Loss on disposal of equipment . ........................................... 5,625 Net cash provided by operating activities . ............................. $ 49,650 Cash flows from investing activities Cash received from sale of equipment . .................................. 11,500 Cash paid for equipment . ........................................................... (25,000 ) Net cash used in investing activities . ...................................... (13,500) Cash flows from financing activities Cash borrowed on short-term note . ........................................ 2,000 Cash paid on long-term note . .................................................... (50,750) Cash received from issuing stock (2,350 x $20) . ..................... 47,000 Cash paid for dividends . ............................................................ (59,000 ) Net cash used in financing activities . ...................................... (60,750
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Ch.+12+Problem+Solutions - Problem 12-1B (40 minutes) Part...

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