ACG 2021 Lecture Notes - Lecture 23: Promissory Note, Regional Policy Of The European Union, Income Statement

54 views2 pages

chocolateleopard236

20 Apr 2018

School

University of Florida

Department

Accounting

Course

ACG 2021

Professor

Jill Kristen Goslinga

For unlimited access to Class Notes, a Class+ subscription is required.

Document Summary

Purposes of cash flow statements: predicts future cash flows, evaluates management decisions, determines ability to pay dividends and interest, shows relations of net income to cash flows. Three types of business activities: operating create revenues, expenses, gains and losses-net income, financing cash flows related to long-term liabilities and owners" equity. Investing cash flows related to long-term assets. Operating activities: creates revenues, expenses, gains, and losses. Inflows: cash collected from customers, dividends received, interest received, outflows, cash paid to suppliers, cash paid to employees, cash paid for income taxes, cash paid for interest. Investing activities: cash flows related to long-term assets. Financing activities: cash obtained from investors or creditors. Inflows: cash received from the sale of the company"s stock, cash received from notes payable, cash received from issuing bonds payable, outflows, cash paid for the repurchase of the company"s own stock, repayment of principal on notes payable.

Related Questions

The Blackbeard Company Ltd provided the following information in regard to its operations for the year ended 30 June 2014:

Cash Book Summary
Opening balance	$20,000	Accounts Payable	$40,000
Accounts receivable	100,000	Bills Payable (suppliers)	20,000
Bills Receivable (suppliers)	20,000	Interest paid	60,000
Debenture Issue	400,000	Operating expenses	180,000
Dividends received	20,000	Salaries & wages	200,000
Interest received	40,000	Current tax payable	80,000
Motor vehicles	60,000	Plant & machinery	100,000
Share capital	200,000	Dividend paid	120,000
		Balance c/d	60,000
	860,000		860,000
Balance b/d	60,000

Required:

(a) Net cash used in operating activities; (b) Net cash used in investing activities; (c) Net cash from financing activities;

(d) Net increase/(decrease) in cash and cash equivalents.

Please use the following format

*Statement of Cash Flows for Blackbeard Company*
*For the Financial Year Ended 30 June 2014*
( i ) Cash flows from Operating Activities	Inflows/	Inflows/
	(Outflows)	(Outflows)










Net cash used in operating activities

( ii ) Cash flows from Investing Activities


Net cash used in Investing Activities

( iii ) Cash flows from Financing Activities

violetcoyote644

The income statement and a schedule reconciling cash flows fromoperating activities to net income are provided below for MacrosoftCorporation.

MACROSOFTCORPORATION
Income Statement
For the Year Ended December 31, 2016
($ in millions)

Revenues andgains:
Sales	$	292.00
Gainon sale of cash equivalents		1.10
Gain onsale of investments		23.10	$	316.20

Expenses and loss:
Cost ofgoods sold	$	111.00
Salaries		39.10
Interestexpense		11.10
Insurance		19.10
Depreciation		9.10
Patentamortization		3.10
Losson sale of land		5.10		197.60

Income before tax				118.60
Income taxexpense				59.30

Netincome			$	59.30

Reconciliation of Net Income to Net Cash Flows from Operating Activities ($ in millions)
Netincome	$	59.30

Adjustments fornoncash effects:
Depreciationexpense		9.10
Patent amortizationexpense		3.10
Loss on sale ofland		5.10
Gain on sale ofinvestment		(23.10	)
Decrease in accountsreceivable		5.10
Increase ininventory		(11.10	)
Increase in accountspayable		17.10
Decrease in bonddiscount		.10
Increase in salariespayable		5.10
Decrease in prepaidinsurance		3.10
Increase in income taxpayable		9.10

Net cash flowsfrom operating activities	$	82.00

Cash Flows from Operating Activities: Cash received from customers Cash increase from sale of cash equivalents Cash paid to suppliers Cash paid to employees Cash paid for interest Cash paid for insurance Cash paid for income taxes Net cash flows from operating activities

pearbat965

The comparative balance sheet of Canace Products Inc. forDecember 31, 2016 and 2015, is shown as follows:

1		Dec. 31, 2016	Dec. 31, 2015
2	Assets
3	Cash	$643,460.00	$679,530.00
4	Accounts receivable (net)	566,490.00	548,320.00
5	Inventories	1,010,720.00	982,600.00
6	Investments	0.00	240,910.00
7	Land	519,510.00	0.00
8	Equipment	879,710.00	680,990.00
9	Accumulated depreciation-equipment	(243,750.00)	(200,970.00)
10	Total assets	$3,376,140.00	$2,931,380.00
11	Liabilities and Stockholdersâ Equity
12	Accounts payable (merchandise creditors)	$772,290.00	$748,770.00
13	Accrued expenses payable (operating expenses)	63,970.00	69,800.00
14	Dividends payable	8,000.00	7,040.00
15	Common stock, $2 par	56,000.00	32,000.00
16	Paid-in capital: Excess of issue price over parâcommon stock	408,000.00	192,000.00
17	Retained earnings	2,067,880.00	1,881,770.00
18	Total liabilities and stockholdersâ equity	$3,376,140.00	$2,931,380.00

The income statement for the year ended December 31, 2016, is asfollows:

1	Sales		$5,974,620.00
2	Cost of merchandise sold		2,451,470.00
3	Gross profit		$3,523,150.00
4	Operating expenses:
5	Depreciation expense	$42,780.00
6	Other operating expenses	3,099,440.00
7	Total operating expenses		3,142,220.00
8	Operating income		$380,930.00
9	Other expense:
10	Loss on sale of investments		(64,890.00)
11	Income before income tax		$316,040.00
12	Income tax expense		102,160.00
13	Net income		$213,880.00

Additional data obtained from an examination of the accounts inthe ledger for 2016 are as follows:

A.	Equipment and land were acquired for cash.
B.	There were no disposals of equipment during the year.
C.	The investments were sold for $176,020 cash
D.	The common stock was issued for cash.
E.	There was a $27,770 debit to Retained Earnings for cashdividends declared.

Prepare a statement of cash flows, using the direct method ofpresenting cash flows from operating activities. Be sure tocomplete the heading of the statement. Refer to the Labels andAmount Descriptions list provided for the exact wording of theanswer choices for text entries. Use the minus sign only toindicate the net cash outflows for each section. âDeductâ, âLessâor colons (:) will automatically appear if required.

Labels and Amount Descriptions

Cash paid for dividends

Cash paid for purchase of equipment

Cash paid for purchase of land

Cash paid for purchase of treasury stock

Cash payments for income taxes

Cash payments for merchandise

Cash payments for operating expenses

Cash received from customers

Cash received from sale of common stock

Cash received from sale of investments

December 31, 2016

Decrease in cash

Depreciation

For the Year Ended December 31, 2016

Gain on sale of investments

Increase in cash

Issuance of common stock for acquisition of land

Issuance of common stock for purchase of equipment

Loss on sale of investments

Net cash flow from financing activities

Net cash flow from investing activities

Net cash flow from operating activities

Net cash flow used for financing activities

Net cash flow used for investing activities

Net cash flow used for operating activities

Canace Products Inc.

Statement of Cash Flows

1	Cash flows from operating activities:
2
3
4
5
6
7
8	Cash flows from investing activities:
9
10
11
12
13
14	Cash flows from financing activities:
15
16
17
18
19	Cash at the beginning of the year
20	Cash at the end of the year

blushmarten502

ACG 2021 Lecture Notes - Lecture 23: Promissory Note, Regional Policy Of The European Union, Income Statement

Document Summary

Get access

Related Documents

ACG 2021 Lecture Notes - Lecture 24: Retained Earnings, Financial Accounting Standards Board, Treasury Stock

ACG 2021 Lecture Notes - Lecture 1: Accounting Equation, Accounts Payable, Net Income

ACG 2021 Chapter Notes - Chapter 3: Accrual

Related Questions