*EXERCISE 13-11
Revenues ………………………………………………………… $195,000)
Deduct: Increase in accounts receivable ………….. 60,000
Cash receipts from customers* ………………….. $135,000
**
Accounts Receivable
Balance, Beginning of year 0
Revenues for the year 195,000
Cash receipts for year 135,000
Balance, End of year 60,000
**
Accounts Payable
Payments for the year 53,000
Balance, Beginning of year 0
Operating expenses for year 78,000
Balance, End of year 25,000
*EXERCISE 13-12
(a) Cash payments to suppliers
Cost of goods sold ……………………………. $4,527.8 million
Add: Increase in inventory ……………….. 17.1
(b) Cash payments for operating expenses
Operating expenses exclusive
of depreciation ……………………………… $9,397.6 million
*EXERCISE 13-13
Cash flows from operating activities
Cash receipts from
Less cash payments:
To suppliers for merchandise ………………. 115,000
For salaries and wages ………………………… 57,000
For operating expenses ……………………….. 28,000
*$50,000 + $190,000
*EXERCISE 13-14
Cash payments for rent
Rent expense …………………………………………….. $ 40,000*
Cash payments for salaries
Salaries expense ………………………………………… $ 65,000*
Cash receipts from customers
Revenue from sales ……………………………………. $170,000*
SOLUTIONS TO PROBLEMS
PROBLEM 13-1A
Transaction
SCF Activity
Affected
Cash Inflow, Outflow,
or No Effect?
Recorded depreciation
expense on the plant assets.
O
No cash flow effect
Recorded and paid interest
expense.
O
Cash outflow
Recorded cash proceeds from
a sale of plant assets.
I
Cash inflow
Acquired land by issuing
common stock.
NC
No cash flow effect
Paid a cash dividend to preferred
stockholders.
F
Cash outflow
Paid a cash dividend
to common stockholders.
F
Cash outflow
Recorded cash sales.
O
Cash inflow
Recorded sales on account.
O
No cash flow effect
Purchased inventory for cash.
O
Cash outflow
Purchased inventory on account.
O
No cash flow effect
PROBLEM 13-2A
(a) Net income can be determined by analyzing
the retained earnings account.
*($300,000 + $11,200 + $16,000 – $250,000)
$11,200).
Common Stock
130,000
11,200
Stock Dividend
13,800
Shares Issued for Cash
155,000
use cash.
(c) Both of the above activities (issue of common stock and payment of
PROBLEM 13-3A
TOBY ZED COMPANY
Partial Statement of Cash Flows
For the Year Ended November 30, 2014
Cash flows from operating activities
Net income …………………………………………………. $1,450,000
Adjustments to reconcile net income
to net cash provided by operating activities
activities:
Depreciation expense ……………………….. $ 85,000
Decrease in inventory ……………………….. 500,000
*PROBLEM 13-4A
TOBY ZED COMPANY
Partial Statement of Cash Flows
For the Year Ended November 30, 2014
Cash flows from operating activities
Cash receipts from customers……… $7,300,000 (1)
Less cash payments:
Computations:
(1) Cash receipts from customers
Sales ………………………………………………………… $7,500,000
(2) Cash payments to suppliers
Cost of goods sold ……………………………………. $4,900,000
(3) Cash payments for operating expenses
Operating expenses, exclusive
of depreciation …………………………. $1,065,000*
Add: Increase in prepaid
PROBLEM 13-5A
RATTIGAN COMPANY
Partial Statement of Cash Flows
For the Year Ended December 31, 2014
Cash flows from operating activities
Net income ………………………………………………….. $226,000
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation expense ……………………………. $ 55,000
*PROBLEM 13-6A
RATTIGAN COMPANY
Partial Statement of Cash Flows
For the Year Ended December 31, 2014
Cash flows from operating activities
Cash receipts from customers………. $955,000 (1)
Less cash payments:
(1) Computation of cash receipts from customers
Revenues ………………………………………………………… $970,000
(2) Computation of cash payments for operating expenses
Operating expenses per income statement ……….. $624,000
(3) Computation of cash payments for income taxes
Income tax expense per income statement ……….. $ 40,000
PROBLEM 13-7A
(a) RAJESH COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2014
Cash flows from operating activities
Net income ………………………………………………… $32,000
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation expense …………………………... $13,300
Increase in accounts payable ……………….. 14,000
Cash flows from investing activities
Sale of plant assets …………………………………….. 9,700
Cash flows from financing activities
Issuance of common stock ………………………….. 4,000
Net increase in cash ………………………………………… 17,000
Cash at beginning of period …………………………….. 20,000
*PROBLEM 13-8A
(a) RAJESH COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2012
Cash flows from operating activities
Cash receipts from customers …… $223,000 (1)
Less cash payments:
To suppliers ………………………. $171,000 (2)
For operating expenses ……… 10,700 (3)
Cash flows from investing activities
Sale of plant assets …………………… 9,700
Cash flows from financing activities
Issuance of common stock ……….. 4,000
Redemption of bonds ……………….. (6,000)
Net increase in cash ………………………… 17,000
Computations:
(1) Cash receipts from customers
Sales ………………………………………………………. $242,000