ACCT 201 Lecture Notes - Lecture 5: Cash Cash, Company Flow, Operating Expense
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24. Jones Co. invests $10,000 @ 10% per year, compounded annually for six years. 4 points The PV of 1 is .7903 and the amount or future value of 1 is 1.7716. $_________
25. Jones Co. wants $25,000 in 6 years. The PV of 1 is .7903 and the amount of 1 is 1.7716. 4 points How much should he invest in Year 1? ____________
26. Assume you invest 1,000 each year for 5 years? How much will be in the fund on 12/31 Year 5? The FV of an annuity is 5.5256 and the PV of an annuity is 5.8019. 3 pts
$_________
28. The following is a comparative balance sheet for Top Ten Clothiers Inc. for the years 2016 and 2015: 14 points
Top Ten Clothiers Inc. Comparative Balance Sheet December 31, 2016 and 2015 | ||
Assets | 2016 | 2015 |
Cash .................................. | $ 43,000 | $ 240,000 |
Accounts receivable ................... | 390,000 | 210,000 |
Inventory ............................. | 360,000 | 450,000 |
Long-term investments ................. | 0 | 120,000 |
Total assets ........................ | $ 793,000 | $1,020,000 |
Liabilities and Equities | ||
Accounts payable ...................... | $ 150,000 | $ 240,000 |
Operating expenses payable ............ | 48,000 | 30,000 |
Bonds payable ......................... | 140,000 | 200,000 |
Common stock .......................... | 250,000 | 250,000 |
Retained earnings ..................... | 205,000 | 300,000 |
Total liabilities and equities ...... | $ 793,000 | $1,020,000 |
The income statement for the year ended December 31, 2016, follows:
Top Ten Clothiers Income Statement For the Year Ended December 31, 2016 | ||
Sales | $1,120,000 | |
Cost of goods sold: | ||
Beginning inventory, January 1, 2016 | $ 450,000 | |
Purchases ........................... | 660,000 | |
Cost of goods available ............. | $1,110,000 | |
Less ending inventory, December 31, 2016 ............................... | 360,000 | 750,000 |
Gross profit on sales ................. | $ 370,000 | |
Operating expenses ... | 360,000 | |
Operating income ...................... | $ 10,000 | |
Other revenues and expenses: | ||
Loss on sale of long-term investment | (15,000) | |
Net loss .............................. | $ (5,000) |
After paying cash dividends, the decrease in retained earnings totaled $95,000. Management is alarmed by the shrinkage in the company's cash position during 2016. Prepare a partial statement of cash flows for 2016 using the direct method.
Top Ten Clothiers Inc. Statement of Cash Flows For the Year Ended December 31, 2016 | ||
Cash flows from operating activities: | ||
Cash receipts from customers ......? | $ ,000 | |
Cash payments for: | ||
Finished Goods Inventory ...... ? | ||
Operating expenses except 18,000 were in cash.. | ,000 | ,000 |
Net cash used in operating activities . | $ |
Sales .......................................... | $ ,000 |
Accounts Receivable, beginning ................. | |
Accounts Receivable, ending .................... | |
Cash collected from customers ................ | $ |
Purchases ...................................... | $ ,000 |
Accounts Payable, beginning .................... | |
Accounts Payable, ending ....................... | |
Cash payments for inventory .................... | $ ,000 |