16-11Solutions
16.4 continued.
(13) Property, Plant, and Eq
ui
pm
en
t ………………………. 875.7
Solutions16-12
Indi
r
e
ct
Metho
d
Changes
i
n
Related Balance Sheet Accounts
from
T-Account
Work
D
i
r
ec
t
Metho
d
Sales Revenues ………………
$20,465.0
$74.6
= Accounts Receivable
D
ec
r
ease
20,539
.6
Receipts from
C
ustome
r
s
16.5 (Metals Company deriving direct method presentation of cash fow from operations using data from T-account work sheet.) (amounts in
millions
of
US
$)
Operati
ons
From
Ope
r
ations:
Receipts Less Expenditures
(a)
© 2013 Cengage
Lea
rning. All rights reserved. No distribution allowed without express
authorization.
16-13Solutions
© 2013 Cengage Lea rning. All rights reserved. No distribution allowed without express authorization.
16.6(Ingers Company; working backward from the statement of cash
flows.) (amounts in millions of US$)
(3) Cash (Investing—Sale of Property, Plant, and
& Eq
ui
pm
en
t) ………………………………………………… 26.5
(12) Property, Plant, and Equipment (Net) ……….22.9
(4) Investment in
Securities
…………………………………. 41.5
(5) Cash (Operations—Deferred Taxes
Addback)
…… 15.1
(6) Cash (Operations—Decrease in Accounts
(7)
Inventories
…………………………………………………….. 15.2
(8) Other Current A
ss
et
s
……………………………………… 33.1
(9) Accounts Payable …………………………………………… 37.9
(10) Cash (Operations—Increase in Other Current
Li
ab
ili
t
i
e
s
) …………………………………………………. 19.2
Other Current Liabilities…………………………. 19.2
(11) Property, Plant, and Eq
ui
pm
en
t ………………………. 211
.
7
Cash (Investing—Acquisition of Property,
Plant, and Equipment)…………………………….. 211.7
Solutions16-14
© 2013 Cengage
Lea
rning. All rights reserved. No distribution allowed without express
authorization.
16.6 continued.
(13) Marketable Securities ……………………………………. 4.6
Cash (Investing—Acquisition of Marketable
Securities)………………………………………………. 4.6
16-15Solutions
16.7 (Warren Corporation; preparing a statement of cash flows.)
(amounts
in
US$)
a
.
C
a
s h
√
O
p
e
r
a
t
i
on
s
Net Income (5) 234,000
Loss on Sale of
Machinery (1b) 15
,
600
Amortize Patent (2b) 5,040
Decrease in
Accounts
Receivable (7) 18
,
000
Bad Debt Expense (8) 2,400
© 2013 Cengage
Lea
rning. All rights reserved. No distribution allowed without express
authorization.
I
n
v
es
t
i
n
g
Sale of Machinery (1b) 57,600 463,200 (1a) Acquisition of
Fi
n
a
ncin
g
Solutions16-16
16.7 a. continued.
Allowance
for
A
cc
o
u
n t
s
R
e
c
e
i
v ab l e
U
n
c
o
ll e
c t i b l e
A
c c
o
u
n t
s
I n
v
e
n to
r
y
√ 327,600 20,400 √ √
645,600
3,600 (6) (6) 3,600 2,400 (8) 66,000
(9)
18,000
(7)
Securities Held for Machinery
and Accumulated
P l a n t
E x p
a
n s
i
o
n
E q
u i p
m
e
n t
(
C
o
s
t
)
D e
p
r
e
c i a t i o
n
√ -0- √ 776,400 446,400
√
√
Leasehold Allowance
for
I m p
r
o
v
e
m
e
n t
s
A
m
o
r t
i z
a t i o
n
P a t
e
n t
s
√ 104,400 58,800 √ √
36,000
10,800 (12) (2a) 2,400 5,040
(2b)
√ 104,400 69,600 √ √
33,360
Bonds
Payable
A
cc
o
u
n t
s
Pa y ab l e
D i vi d
e
n d
s
Pa y a b l e
(
C
u
r
r
e
n t
)
√
6%
Serial
B
o
n d
s
Pa y ab l e
P r
e
f
e
rr
e
d
S t
o
c
k
C
o
mm
o
n
S to
c
k
√
Ret
a i
ne
d
E ar
n i
n
g
s
16-17Solutions
16.7 continued.
b.WARREN CORPORATION Statement of
Cash Flows
For the Year Ending June 30, 2014
Operatio
ns:
Net I
nc
ome ……………………………………………… $ 234,000
Loss on Sale of Machinery ……………………….. 15,600
Decrease in
Inventories
…………………………….66,000
Increase in Accounts Payable…………………….
15
3
,
36
0
Cash Flow from
Operations
…………………………. $
612,000
Investi
ng:
Sale of Machinery……………………………………. $ 57,600
Payment of Legal Fee for Patent Defense ……
(2,40
0) Acquisition of Securities for Plant
Solutions16-18
16.8 (Roth Company; preparing a statement of cash flows.) (amounts
in
US
$)
a
.
C
a
s h
√37
,
9
50
O
p
e
r
a
t
i
o
n
s
Increase in
Income
Condemnatio
n
Taxes Payable (14) 51,924 of Land
Deferred Taxes (15) 504 37,500 (8) Increase in
Accounts
R
ecei
vab
l
e
26
,
250 (9) Increase
in
I
n
ve
n
t
ories
I
n
v
es
t
i
n
g
Marketable
S
e c u r i
t
i
e
s
A
cc
o
u n
t
s
R
e c e i
va
b
l
e
I
n
v
e
n
t
o r
y
16-19Solutions
16.8 a. continued.
L
a
n
d
B
u
il
d
i
n
g
E
q
u
i
p
m
e n
t
Accumulated Investment
in
D
e
p
r
e
c i
a
t
i
on
3
0
%
Ow n
ed
C
o
m
p
a
n
y
O
t
h
e
r
A
ss
e
t
s
22,500 √ √ 91,830 √
22
,
650
1,875(10) (11) 8,640
24,375 √ √ 100,470 √
22
,
650
A
cc
o
u n
t
s P
ay
a
b
l
e
D i
v
i
d
e
n
d
s P
ay
a
b
l
e
I
n c
o
m
e
T
a
x
es
P
ay
a
b
l
e
√
D
efe
rr
ed
O
t
h
e
r L i
ab
i
li
t
i
e
s
B
o n
d
s P
aya
b
l
e
I
n c
o
m
e
T
a
x
es
√
Unrealized H
ol
d
in
g
Loss on
M
a
rk
etab
l
e
P r
e
f
e
rr
ed
S
t
o c k
C
o
m
m
on S
t
o c k
S
e c u r i
t
i
e
s
Re
t
a
i
n
ed
Ea
rn
in
g
s
124,
65
0
√
(13)12,00
0
95,84
7
(1)
208,49
7
√
Solutions16-20
16.8 continued.
b. ROTH COMPANY
Statement of Cash
Flows
For the Three Months Ended March 31, 2014
Operations:
Net I
nc
ome ………………………………………………
Bond Discount
Amortization
…………………….
Depreciation ……………………………………………
Deferred Income
Taxes
……………………………..
Indi
r
e
ct
Metho
d
Changes
i
n
Related Balance Sheet Accounts
from
T-Account
Work
D
i
r
ec
t
Metho
d
Sales Revenues ………………
$20,465.0
$74.6
= Accounts Receivable
D
ec
r
ease
20,539
.6
Receipts from
C
ustome
r
s
16.5 (Metals Company deriving direct method presentation of cash fow from operations using data from T-account work sheet.) (amounts in
millions
of
US
$)
Operati
ons
From
Ope
r
ations:
Receipts Less Expenditures
(a)
© 2013 Cengage
Lea
rning. All rights reserved. No distribution allowed without express
authorization.
16-13Solutions
© 2013 Cengage Lea rning. All rights reserved. No distribution allowed without express authorization.
16.6(Ingers Company; working backward from the statement of cash
flows.) (amounts in millions of US$)
(3) Cash (Investing—Sale of Property, Plant, and
& Eq
ui
pm
en
t) ………………………………………………… 26.5
(12) Property, Plant, and Equipment (Net) ……….22.9
(4) Investment in
Securities
…………………………………. 41.5
(5) Cash (Operations—Deferred Taxes
Addback)
…… 15.1
(6) Cash (Operations—Decrease in Accounts
(7)
Inventories
…………………………………………………….. 15.2
(8) Other Current A
ss
et
s
……………………………………… 33.1
(9) Accounts Payable …………………………………………… 37.9
(10) Cash (Operations—Increase in Other Current
Li
ab
ili
t
i
e
s
) …………………………………………………. 19.2
Other Current Liabilities…………………………. 19.2
(11) Property, Plant, and Eq
ui
pm
en
t ………………………. 211
.
7
Cash (Investing—Acquisition of Property,
Plant, and Equipment)…………………………….. 211.7
Solutions16-14
© 2013 Cengage
Lea
rning. All rights reserved. No distribution allowed without express
authorization.
16.6 continued.
(13) Marketable Securities ……………………………………. 4.6
Cash (Investing—Acquisition of Marketable
Securities)………………………………………………. 4.6
16-15Solutions
16.7 (Warren Corporation; preparing a statement of cash flows.)
(amounts
in
US$)
a
.
C
a
s h
√
O
p
e
r
a
t
i
on
s
Net Income (5) 234,000
Loss on Sale of
Machinery (1b) 15
,
600
Amortize Patent (2b) 5,040
Decrease in
Accounts
Receivable (7) 18
,
000
Bad Debt Expense (8) 2,400
© 2013 Cengage
Lea
rning. All rights reserved. No distribution allowed without express
authorization.
I
n
v
es
t
i
n
g
Sale of Machinery (1b) 57,600 463,200 (1a) Acquisition of
Fi
n
a
ncin
g
Solutions16-16
16.7 a. continued.
Allowance
for
A
cc
o
u
n t
s
R
e
c
e
i
v ab l e
U
n
c
o
ll e
c t i b l e
A
c c
o
u
n t
s
I n
v
e
n to
r
y
√ 327,600 20,400 √ √
645,600
3,600 (6) (6) 3,600 2,400 (8) 66,000
(9)
18,000
(7)
Securities Held for Machinery
and Accumulated
P l a n t
E x p
a
n s
i
o
n
E q
u i p
m
e
n t
(
C
o
s
t
)
D e
p
r
e
c i a t i o
n
√ -0- √ 776,400 446,400
√
√
Leasehold Allowance
for
I m p
r
o
v
e
m
e
n t
s
A
m
o
r t
i z
a t i o
n
P a t
e
n t
s
√ 104,400 58,800 √ √
36,000
10,800 (12) (2a) 2,400 5,040
(2b)
√ 104,400 69,600 √ √
33,360
Bonds
Payable
A
cc
o
u
n t
s
Pa y ab l e
D i vi d
e
n d
s
Pa y a b l e
(
C
u
r
r
e
n t
)
√
6%
Serial
B
o
n d
s
Pa y ab l e
P r
e
f
e
rr
e
d
S t
o
c
k
C
o
mm
o
n
S to
c
k
√
Ret
a i
ne
d
E ar
n i
n
g
s
16-17Solutions
16.7 continued.
b.WARREN CORPORATION Statement of
Cash Flows
For the Year Ending June 30, 2014
Operatio
ns:
Net I
nc
ome ……………………………………………… $ 234,000
Loss on Sale of Machinery ……………………….. 15,600
Decrease in
Inventories
…………………………….66,000
Increase in Accounts Payable…………………….
15
3
,
36
0
Cash Flow from
Operations
…………………………. $
612,000
Investi
ng:
Sale of Machinery……………………………………. $ 57,600
Payment of Legal Fee for Patent Defense ……
(2,40
0) Acquisition of Securities for Plant
Solutions16-18
16.8 (Roth Company; preparing a statement of cash flows.) (amounts
in
US
$)
a
.
C
a
s h
√37
,
9
50
O
p
e
r
a
t
i
o
n
s
Increase in
Income
Condemnatio
n
Taxes Payable (14) 51,924 of Land
Deferred Taxes (15) 504 37,500 (8) Increase in
Accounts
R
ecei
vab
l
e
26
,
250 (9) Increase
in
I
n
ve
n
t
ories
I
n
v
es
t
i
n
g
Marketable
S
e c u r i
t
i
e
s
A
cc
o
u n
t
s
R
e c e i
va
b
l
e
I
n
v
e
n
t
o r
y
16-19Solutions
16.8 a. continued.
L
a
n
d
B
u
il
d
i
n
g
E
q
u
i
p
m
e n
t
Accumulated Investment
in
D
e
p
r
e
c i
a
t
i
on
3
0
%
Ow n
ed
C
o
m
p
a
n
y
O
t
h
e
r
A
ss
e
t
s
22,500 √ √ 91,830 √
22
,
650
1,875(10) (11) 8,640
24,375 √ √ 100,470 √
22
,
650
A
cc
o
u n
t
s P
ay
a
b
l
e
D i
v
i
d
e
n
d
s P
ay
a
b
l
e
I
n c
o
m
e
T
a
x
es
P
ay
a
b
l
e
√
D
efe
rr
ed
O
t
h
e
r L i
ab
i
li
t
i
e
s
B
o n
d
s P
aya
b
l
e
I
n c
o
m
e
T
a
x
es
√
Unrealized H
ol
d
in
g
Loss on
M
a
rk
etab
l
e
P r
e
f
e
rr
ed
S
t
o c k
C
o
m
m
on S
t
o c k
S
e c u r i
t
i
e
s
Re
t
a
i
n
ed
Ea
rn
in
g
s
124,
65
0
√
(13)12,00
0
95,84
7
(1)
208,49
7
√
Solutions16-20
16.8 continued.
b. ROTH COMPANY
Statement of Cash
Flows
For the Three Months Ended March 31, 2014
Operations:
Net I
nc
ome ………………………………………………
Bond Discount
Amortization
…………………….
Depreciation ……………………………………………
Deferred Income
Taxes
……………………………..