178.Based on the information provided below for Krackle Corp., complete the following worksheet to be used to prepare the statement of cash flows using the indirect method.
(a) Net income for the year was $30,000.
(b) Dividends of $10,000 were declared and paid.
(c) Krackle's only noncash expense was depreciation which totaled $50,000.
(d) The company purchased plant assets for $70,000.
(e) Notes payable in the amount of $40,000 were issued during the year for cash.
Krackle Corporation
Spreadsheet for Statement of Cash Flows—Indirect Method
For Year Ended December 31, 2015
Analysis of Changes
12/31/14DebitCredit12/31/15
Balance Sheet—Debits
Cash70,000 60,000
Accounts receivable180,000 190,000
Merchandise inventory200,000 230,000
Plant assets500,000 570,000
950,000 1,050,000
Balance Sheet—Credits
Accumulated depreciation100,000 150,000
Accounts payable170,000 160,000
Notes payable350,000 390,000
Capital stock200,000 200,000
Retained earnings130,000 150,000
950,000 1,050,000
Statement of Cash Flows
Operating activities
Net income
Increase in accounts receivable
Increase in merchandise inventory
Decrease in accounts payable
Depreciation expense
Investing activities
Financing activities
Cash paid for dividends
Cash received from note payable
179.The following selected account balances are taken from a merchandising company's records:
Dec. 31
2015Dec. 31,
2014For the
Year 2015
Merchandise inventory$15,600$21,200
Accounts receivable42,00036,000
Accounts payable32,40027,400
Salaries payable4,4003,000
Total assets234,000286,000
Sales $312,000
Cost of goods sold 165,600
Salaries expense 48,000
(a) Calculate the cash payments made during 2015 for merchandise. Assume all of the company's accounts payable balances result from merchandise purchases.
(b) Calculate the cash receipts from customer sales during 2015.
(c) Calculate the cash payments for salaries during 2015.
180.Use the following calendar-year information to prepare Adam Company's statement of cash flows using the direct method.
Cash paid to purchase machinery$124,000
Cash paid for merchandise inventory220,000
Cash paid for operating expenses280,000
Cash paid for interest4,000
Cash received for interest10,000
Cash proceeds from sale of land100,000
Cash balance at beginning of year15,000
Cash balance at end of year77,000
Cash borrowed on a short-term note25,000
Cash dividends paid24,000
Cash received from stock issuance57,000
Cash collections from customers522,000