Questions 1 – 3 require you to provide certain information; write the answer in the space…

Financing and Investing Activities

Spring 2020 – Final Exam

Questions 1 – 3 require you to provide certain information; write the answer in the space provided. Show all work on supporting documentation that is requiredto be submitted at the end of the exam.

1.

Prepare a schedule, using the template provided, computing net cash from operations for the year ended December 31, 2019 using BOTH the indirect and direct methods. The following selected information is available:

December 31

2019

2018

Accounts receivable

1,750

1,300

Inventory

1,600

1,900

Prepaid rent

200

250

Accounts payable

1,200

900

Wages payable

100

200

Accrued liabilities

125

125

Sales

6,900

Cost of goods sold

4,700

Rent expense

300

Wages expense

450

Depreciation expense

30

Interest expense

150

Income tax expense

540

Gain on sale of investment

80

Cash Flows from Operating Activities:

Net income

Adjustments to reconcile net income to net cash flows:

Net cash flows from operating activities

Cash Flows from Operations:

Net cash flows from operations

2. The ABC Corporation provided the following partial list of accounts, balances and activities for 2019:

December 31,

2019

2018

Investment in LT investments

1,300

1,420

Plant assets

1,900

1,700

Accumulated depreciation

1,200

1,170

ABC’s income statement reported a $80 gain on sale of LT investments.

The company did not sell any plant assets, but $70 of common stock was issued in exchange for plant assets.

Depreciation expense for the year was $30.

Purchases of additional plant assets were cash transactions.

Required:

Prepare the investing activities section of the statement of cash flows in the template below:

Cash Flows from Investing Activities:

Net cash flows from investing activities

3. The XYZ Corporation provided the following partial list of accounts, balances and additional information for 2019:

December 31,

2019

2018

Bonds payable

1,550

1,400

Dividends payable

400

450

Common stock

120

100

APIC -CS

1,780

1,600

Retained earnings

2,450

1,900

Net income for 2019 was reported as $810.

Required:

Prepare the financing activities section of the statement of cash flows in the template below:

Cash Flows from Financing Activities:

Net cash flows from financing activities

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