Visual Inspection – The following changes in account balances were taken from the adjusted trial balance of the Walson Company at the end of 2007:
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Net Changes for 2007 Don't use plagiarized sources. Get Your Custom Essay on
using visual inspection and the direct method prepare a 2007 statement of cash flows 610542
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Debit |
Credit |
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Cash |
$2,100 |
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Accounts receivable |
8,700 |
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Inventory |
$2,500 |
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Land |
1,900 |
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Buildings and equipment |
10,400 |
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Accumulated depreciation |
6,800 |
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Accounts payable |
4,500 |
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Salaries payable |
800 |
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Income taxes payable |
1,000 |
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Common stock, no par |
9,000 |
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Retained earnings |
4,000 |
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Sales |
69,000 |
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Cost of goods sold |
34,000 |
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Salaries expense |
17,200 |
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Depreciation expense |
6,800 |
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Income tax expense |
3,300 |
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Totals |
$91,000 |
$91,000 |
In addition, the following information was obtained from the company’s records:
1. Land was sold, at cost, for $1,900
2. Dividends of $4,000 were declared and paid
3. Equipment was purchased for $10,400
4. Common stock was issued for $9,000
5. Beginning cash balance was $17,000
Required
Using visual inspection and the direct method, prepare a 2007 statement of cash flows for the Walson Company. (A separate schedule reconciling net income to cash provided by operating activities is not necessary.)
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