12–241
12–242
108.
Financial statements of Rukavina Corporation follow:
Comparative Balance Sheet
Ending Balance
Beginning Balance
Assets:
Cash and cash equivalents
$36
$38
Accounts receivable
39
44
Inventory
34
35
Property, plant and equipment
386
360
Less accumulated depreciation
202
191
Total assets
$293
$286
Liabilities and stockholders’ equity:
Accounts payable
$71
$61
Bonds payable
176
220
Common stock
81
80
Retained earnings
(35)
(75)
Total liabilities and equity
$293
$286
Income Statement
Sales
$518
Cost of goods sold
336
Gross margin
182
Selling and administrative expense
113
Net operating income
69
Income taxes
21
Net income
$48
Cash dividends were $8. The company did not dispose of any property, plant, and
equipment. It did not issue any bonds payable or repurchase any of its own common stock.
The following questions pertain to the company’s statement of cash flows.
The net cash provided by (used in) financing activities for the year was:
12–243
12–244
109.
Buckley Corporation’s most recent comparative balance sheet appears below:
Comparative Balance Sheet
Ending Balance
Beginning Balance
Assets:
Cash and cash equivalents
$19
$20
Accounts receivable
26
27
Inventory
56
51
Property, plant and equipment
686
550
Less accumulated depreciation
430
363
Total assets
$357
$285
Liabilities and stockholders’ equity:
Accounts payable
$30
$34
Bonds payable
43
40
Common stock
54
50
Retained earnings
230
161
Total liabilities and stockholders’ equity
$357
$285
The company’s net income for the year was $91 and it paid a cash dividend of $22. It did
not dispose of any property, plant, and equipment during the year. The company did not
retire any bonds payable or repurchase any of its own common stock.
The net cash provided by (used in) operating activities for the year was:
12–245
12–246
110.
Buckley Corporation’s most recent comparative balance sheet appears below:
Comparative Balance Sheet
Ending Balance
Beginning Balance
Assets:
Cash and cash equivalents
$19
$20
Accounts receivable
26
27
Inventory
56
51
Property, plant and equipment
686
550
Less accumulated depreciation
430
363
Total assets
$357
$285
Liabilities and stockholders’ equity:
Accounts payable
$30
$34
Bonds payable
43
40
Common stock
54
50
Retained earnings
230
161
Total liabilities and stockholders’ equity
$357
$285
The company’s net income for the year was $91 and it paid a cash dividend of $22. It did
not dispose of any property, plant, and equipment during the year. The company did not
retire any bonds payable or repurchase any of its own common stock.
The net cash provided by (used in) investing activities for the year was:
12–247
12–248
111.
Buckley Corporation’s most recent comparative balance sheet appears below:
Comparative Balance Sheet
Ending Balance
Beginning Balance
Assets:
Cash and cash equivalents
$19
$20
Accounts receivable
26
27
Inventory
56
51
Property, plant and equipment
686
550
Less accumulated depreciation
430
363
Total assets
$357
$285
Liabilities and stockholders’ equity:
Accounts payable
$30
$34
Bonds payable
43
40
Common stock
54
50
Retained earnings
230
161
Total liabilities and stockholders’ equity
$357
$285
The company’s net income for the year was $91 and it paid a cash dividend of $22. It did
not dispose of any property, plant, and equipment during the year. The company did not
retire any bonds payable or repurchase any of its own common stock.
The net cash provided by (used in) financing activities for the year was:
12–249
12–250
112.
Buckley Corporation’s most recent comparative balance sheet appears below:
Comparative Balance Sheet
Ending Balance
Beginning Balance
Assets:
Cash and cash equivalents
$19
$20
Accounts receivable
26
27
Inventory
56
51
Property, plant and equipment
686
550
Less accumulated depreciation
430
363
Total assets
$357
$285
Liabilities and stockholders’ equity:
Accounts payable
$30
$34
Bonds payable
43
40
Common stock
54
50
Retained earnings
230
161
Total liabilities and stockholders’ equity
$357
$285
The company’s net income for the year was $91 and it paid a cash dividend of $22. It did
not dispose of any property, plant, and equipment during the year. The company did not
retire any bonds payable or repurchase any of its own common stock.
The free cash flow for the year was:
12–251
12–252
113.
Megan Corporation’s net income last year was $98,000. Changes in the company’s balance
sheet accounts for the year appear below:
Increases
(Decreases)
Asset and Contra-Asset Accounts:
Cash
($3,000)
Accounts receivable
($14,000)
Inventory
$3,000
Prepaid expenses
($7,000)
Long-term investments
$80,000
Property, plant and equipment
$55,000
Accumulated depreciation
$58,000
Liability and Equity Accounts:
Accounts payable
$0
Accrued liabilities
$15,000
Income taxes payable
($11,000)
Bonds payable
($30,000)
Common stock
$20,000
Retained earnings
$62,000
The company paid a cash dividend of $36,000 and it did not dispose of any long-term
investments or property, plant, and equipment. The company did not issue any bonds
payable or repurchase any of its own common stock. The following questions pertain to
the company’s statement of cash flows.
The net cash provided by (used in) operating activities last year was:
12–253
12–254
114.
Megan Corporation’s net income last year was $98,000. Changes in the company’s balance
sheet accounts for the year appear below:
Increases
(Decreases)
Asset and Contra-Asset Accounts:
Cash
($3,000)
Accounts receivable
($14,000)
Inventory
$3,000
Prepaid expenses
($7,000)
Long-term investments
$80,000
Property, plant and equipment
$55,000
Accumulated depreciation
$58,000
Liability and Equity Accounts:
Accounts payable
$0
Accrued liabilities
$15,000
Income taxes payable
($11,000)
Bonds payable
($30,000)
Common stock
$20,000
Retained earnings
$62,000
Purchase of long-term investments
The company paid a cash dividend of $36,000 and it did not dispose of any long-term
investments or property, plant, and equipment. The company did not issue any bonds
payable or repurchase any of its own common stock. The following questions pertain to
the company’s statement of cash flows.
The net cash provided by (used in) investing activities last year was:
12–255
12–256
115.
Megan Corporation’s net income last year was $98,000. Changes in the company’s balance
sheet accounts for the year appear below:
Increases
(Decreases)
Asset and Contra-Asset Accounts:
Cash
($3,000)
Accounts receivable
($14,000)
Inventory
$3,000
Prepaid expenses
($7,000)
Long-term investments
$80,000
Property, plant and equipment
$55,000
Accumulated depreciation
$58,000
Liability and Equity Accounts:
Accounts payable
$0
Accrued liabilities
$15,000
Income taxes payable
($11,000)
Bonds payable
($30,000)
Common stock
$20,000
Retained earnings
$62,000
Repaying principal on bonds payable
Issuance of common stock
Paying a dividend
The company paid a cash dividend of $36,000 and it did not dispose of any long-term
investments or property, plant, and equipment. The company did not issue any bonds
payable or repurchase any of its own common stock. The following questions pertain to
the company’s statement of cash flows.
The net cash provided by (used in) financing activities last year was:
12–257
12–258
116.
Megan Corporation’s net income last year was $98,000. Changes in the company’s balance
sheet accounts for the year appear below:
Increases
(Decreases)
Asset and Contra-Asset Accounts:
Cash
($3,000)
Accounts receivable
($14,000)
Inventory
$3,000
Prepaid expenses
($7,000)
Long-term investments
$80,000
Property, plant and equipment
$55,000
Accumulated depreciation
$58,000
Liability and Equity Accounts:
Accounts payable
$0
Accrued liabilities
$15,000
Income taxes payable
($11,000)
Bonds payable
($30,000)
Common stock
$20,000
Retained earnings
$62,000
The company paid a cash dividend of $36,000 and it did not dispose of any long-term
investments or property, plant, and equipment. The company did not issue any bonds
payable or repurchase any of its own common stock. The following questions pertain to
the company’s statement of cash flows.
The free cash flow for the year was:
12–259
12–260
117.
The most recent comparative balance sheet of Giacomelli Corporation appears below:
Ending Balance
Beginning Balance
Assets:
Current assets:
Cash and cash equivalents
$37,000
$29,000
Accounts receivable
20,000
24,000
Inventory
65,000
61,000
Prepaid expenses
5,000
7,000
Total current assets
127,000
121,000
Property, plant, and equipment
424,000
399,000
Less accumulated depreciation
231,000
200,000
Net property, plant, and equipment
193,000
199,000
Total assets
$320,000
$320,000
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable
$19,000
$17,000
Accrued liabilities
58,000
51,000
Income taxes payable
47,000
42,000
Total current liabilities
124,000
110,000
Bonds payable
77,000
80,000
Total liabilities
201,000
190,000
Stockholders’ equity:
Common stock
31,000
30,000
Retained earnings
88,000
100,000
Total stockholders’ equity
119,000
130,000
Total liabilities and stockholders’ equity
$320,000
$320,000
The company uses the indirect method to construct the operating activities section of its
statements of cash flows.
Which of the following is correct regarding the operating activities section of the
statement of cash flows?