Chapter 13 – Statement of Cash Flows
13–11
Exercise 13-10
Cash flows from financing activities
Loan proceeds
$150,000a
Common stock cash dividends paid
(15,000)
Loan repayment
(50,000)
Net cash provided (used) by financing activities
$85,000
13–12
Exercise 13-11
Rindt Industries
Statement of Cash Flows
Cash flows from operating activities
Net income
$26,043
Adjustments to net income
Depreciation and amortization
$24,262
Loss on disposal of equipment
150
Decrease in accounts receivable
1,048
Increase in inventory
(3,465)
Increase in accounts payable
4,650
26,645
Net cash provided (used) by operating activities
52,688
Cash flows from investing activities
Sale of marketable securities
14,000
Proceeds from disposal of equipment
819
Purchase of equipment
(21,632)
Net cash provided (used) by investing activities
(6,813)
Cash flows from financing activities
Payment of cash dividends
(3,543)
Proceeds from issuance of common stock
2,241
Net cash provided (used) by financing activities
(1,302)
Change in cash
44,573
Cash, beginning balance
19,600
Cash, ending balance
$64,173
Chapter 13 – Statement of Cash Flows
13–13
Exercise 13-12
Daniels Distributing
Statement of Cash Flows
Cash flows from operating activities
Net income
$429,800
Adjustments to net income
Depreciation and amortization
$ 31,980
Gain on disposal of equipment
(5,200)
Stock-based compensation
180,000
Increase in accounts receivable
(16,760)
Increase in inventory
(14,863)
Decrease in prepaid assets
3,700
Decrease in accounts payable
(13,900)
164,957
Net cash provided (used) by operating activities
594,757
Cash flows from investing activities
Purchase of marketable securities
(200,000)
Purchase of equipment
(80,925)
Net cash provided (used) by investing activities
(280,925)
Cash flows from financing activities
Proceeds from loan
125,000
Proceeds from issuance of common stock
25,000
Net cash provided (used) by financing activities
150,000
Change in cash
463,832
Cash, beginning balance
43,740
Cash, ending balance
$507,572
Solutions for Davis & Davis, Managerial Accounting, 2nd ed.
13–14
Exercise 13-13
Thalina Mineral Works has not generated net cash from operations for
time meeting its cash obligations.
Exercise 13-14
makes it unusual.
b. If Lind Industries continues to sell significant components of its
Exercise 13-15
remained relatively constant.
b. The absence of long-term debt proceeds for 2013 and 2014 does not
Chapter 13 – Statement of Cash Flows
13–15
Exercise 13-15, continued
c. Using more cash than is provided through financing activities is not in
consistently make repayments.
Exercise 13-16
Beginning A/R balance + Sales – Collections
= Ending A/R balance
$10,000 + $145,780 – Collections
= $18,000
$10,000 + $145,780 – $18,000
= Collections
$137,780
= Collections
Exercise 13-17
Beginning A/R balance + Sales – Collections
= Ending A/R balance
$1,011 + $12,822 – Collections
= $1,143
$1,011 + $12,822 – $1,143
= Collections
$12,690
= Collections
Exercise 13-18
Beginning A/P balance + Purchases – Payments
= Ending A/P balance
$341,053 + $1,951,523 – Payments
= $160,094
$341,053 + $1,951,523 – $160,094
= Payments
$2,132,482
= Payments
13–16
Exercise 13-19
Beginning Inventory balance + Purchases – COGS
= Ending Inventory balance
$30,000 + Purchases – $94,750
= $26,000
Purchases
= $26,000 – $30,000 + $94,750
Purchases
= $90,750
Beginning A/P balance + Purchases – Payments
= Ending A/P balance
$17,800 + $90,750 – Payments
= $19,500
$17,800 + $90,750 – $19,500
= Payments
$89,050
= Payments
Exercise 13-20
Beginning SP balance + salaries expense – payments to employees
= Ending SP balance
$93.9 + $1,736.2 – Payments
= $71.3
$93.9 + $1,736.2 – $71.3
= Payments
$1,758.8
= Payments
Exercise 13-21
Beginning AL balance + operating expense –payments for operating expenses
= Ending AL balance
$8.2 + $78.5 – Payments
= $10.01
$8.2 + $78.5 – $10.01
= Payments
$76.69
= Payments
Chapter 13 – Statement of Cash Flows
13–17
Exercise 13-22
Geiersbach Grain
Statement of Cash Flows
Cash flows from operating activities
Collections from customers
$130,940
Payments to suppliers
(36,990)
Payments to employees
(36,480)
Payments for operating expenses
(27,400)
Payments for income taxes
(11,200)
Net cash provided (used) by operating activities
$18,870
Cash flows from investing activities
Sale of marketable securities
15,130
Sale of equipment
20,600
Purchase of equipment
(23,670)
Net cash provided (used) by investing activities
12,060
Cash flows from financing activities
Payment of cash dividends
(500)
Repayment of long-term debt
(19,215)
Issuance of common stock
1,450
Net cash provided (used) by financing activities
(18,265)
Change in cash
12,665
Cash, beginning balance
13,645
Cash, ending balance
$26,310
13–18
SOLUTIONS TO PROBLEMS
Problem 13-23
Addison Controls
Statement of Cash Flows
For the year ended December 31, 2013
Cash flows from operating activities
Net income
$11,300
Adjustments to net income
Depreciation
$1,900
Gain on sale of land
(900)
Increase in accounts receivable
(800)
Decrease in inventories
2,500
Decrease in accounts payable
(2,500)
Increase in accrued expenses
200
Decrease in income taxes payable
(500)
(100)
Net cash provided (used) by operating activities
11,200
Cash flows from investing activities
Sale of equipment
20,300
Purchase of equipment
(17,500)
Net cash provided (used) by investing activities
2,800
Cash flows from financing activities
Issue bonds
10,000
Cash dividends on common stock
(23,200)
Net cash provided (used) by financing activities
(13,200)
Change in cash
800
Cash, beginning balance
4,300
Cash, ending balance
$5,100
Chapter 13 – Statement of Cash Flows
13–19
Problem 13-24
Cook Enterprises
Statement of Cash Flows
For the year ended December 31, 2013
Cash flows from operating activities
Net income
$95,200
Adjustments to net income
Depreciation
$30,000
Gain on sale of equipment
(17,000)
Increase in accounts receivable
(17,400)
Increase in inventories
(30,000)
Decrease in accounts payable
(25,000)
Decrease in income taxes payable
(2,400)
(61,800)
Net cash provided (used) by operating activities
33,400
Cash flows from investing activities
Sale of equipment
30,000
Purchase of building
(150,000)
Net cash provided (used) by investing activities
(120,000)
Cash flows from financing activities
Proceeds from issuing common stock
100,000
Proceeds from long-term debt
75,000
Repayment of long-term debt
( 4,600)
170,400
Net cash provided (used) by financing activities
Change in cash
83,800
Cash, beginning balance
40,400
Cash, ending balance
$124,200
Solutions for Davis & Davis, Managerial Accounting, 2nd ed.
13–20
Problem 13-25
Student answers will vary.
Cash flows from operating activities
year.
Cash flows from investing activities
company is expanding.
Purchases of property and equipment are approximately equal to
depreciation expense, indicating ongoing investment in productive
assets.
Regular purchase and sale of short-term investments puts excess
cash to work.
Cash flows from financing activities