Worksheet (Spreadsheet) and Statement of Cash Flows – The following information is available for the Bott Company: Account Balances December 31, 2006 December 31,2007 Debits Cash $1,800 $2,000 Accounts receivable 4,600 4,720 Notes receivable (short-term) 0 1,000 Inventories 12,000 9,700 Prepaid items 1,700 1,380 Land 11,000 17,100 Buildings and equipment 78,000 110,000 Patent 4,400 4,000 Treasury stock (common, at cost, $25 per share) 2,500 1,000 […]

Comprehensive – Angel Company has prepared its financial statements for the year ended December 31, 2007 and for the three months ended March 31, 2008. You have been asked to prepare a statement of cash flows for the three months ended March 31, 2008. The company’s balance sheet data at December 31, 2007 and March 31, 2008, and its income statement data for the three […]

Statement of Cash Flows – The following is a list of the items to be included in the preparation of the 2007 statement of cash flows for the Yellow Company: 1. Proceeds from sale of land, $2,100 2. Payments of interest, $5,000 3. Equipment acquired by capital lease, $7,200 4. Proceeds from issuance of preferred stock, $11,000 5. Other operating payments, $1,300 6. Interest and […]

Worksheet and Statement – Use the information presented in P22-13 for the Farrell Corporation. Required 1. Using the direct method for operating cash flows, prepare a worksheet (spreadsheet) to support a 2007 statement of cash flows. (Hint: Combine the income statement and December 31, 2007 balance sheet items for the adjusted trial balance. Use a retained earnings balance of $291,000 in this adjusted trial balance.) […]

Comprehensive – The following are the December 31, 2006 post-closing trial balance and the December 31, 2007 adjusted trial balance of the Adair Company: 12/31/06 Post-Closing Trial Balance 12/31/07 Adjusted Trial Balance Accounts Debit Credit Debit Credit Cash 2,700 3,300 Accounts receivable 7,300 6,200 Inventory 8,100 9,900 Investments in bonds 10,000 18,600 Property and equipment 105,300 133,300 Accumulated depreciation 42,400 49,200 Accounts payable 8,100 8,500 […]

Financing and Investing Activities Not Involving Cash – The statement of cash flows is normally a required basic financial statement for each period for which an earnings statement is presented. The statement should include a separate schedule listing the financing and investing activities not involving cash. Required 1. What are financing and investing activities not involving cash? 2. What are two types of financing and […]

Analyzing Coca-Cola’s Cash Flow Disclosures – Refer to the financial statements and related notes of The Coca-Cola Company in Appendix A of this book. Required 1. What was the net cash provided by operating activities for 2004? What method was used to determine this amount? What was the largest positive adjustment to net income? 2. What was the net cash used in investing activities for […]

Ethics and Cash Flows – You are the accountant for Nello Company, which manufactures specialty equipment. Nello has been in financial difficulty, so its suppliers require purchases to be paid in cash. Furthermore, Nello has long-term debt with a debt covenant that requires it to maintain a 1:1 acid-test (quick) ratio. Nello’s employees work a five-day week, Monday through Friday. On Wednesday morning during the […]

Researching GAAP Situation – You are the new accountant for 12th National Bank and are preparing its 2007 statement of cash flows. The bank reports net income of $75,800 on its 2007 income statement. Included in this net income are the following items: $6,700 gain on sale of trading securities, $1,200 unrealized holding gain on trading securities, and $5,100 loss on sale of securities available […]

This exercise will allow you to practice recording various types of dividends. A corporation has the following stockholder equity items at December 31, 2013: Common stock, $10 par, 200,000 shares authorized, 80,000 shares issued $800,000 Paid-in capital in excess of par value 2,400,000 Retained earnings 28.500.000 Total paid-in capital and retained earnings 31,700,000 Less: Treasury stock, 2,000 shares at cost 24.000 Total stockholders” equity $31,676,000 […]