Homework SourseThe following information is related to New Lane Companys fi
The following information is related to New Lane Company\'s fiscal year 2017.
Income Statement:
Net Income $300,000
Depreciation Expense 30,000
Loss on Sale of Plant Assets 10,000
Interest Expense 500
Balance Sheet - 12/31/17:
Accounts Payable Increase 4,000
Accounts Receivable Increase 5,000
Plant Assets - Purchased 200,000
Plant Assets – Proceeds
from sale 100,000
Additional Information:
Cash Balance - 12/31/2016: $50,000
Common Stock exchanged for outstanding Long-Term Notes Payable of $150,000
Dividends paid were $30,000
Use this information to prepare the Statement of Cash Flows for New Lane\'s Company using the indirect method.
Solution
prepare the Statement of Cash Flows for New Lane\'s Company using the indirect method.
| Cash flow from operating activities | ||
| Net income | 300000 | |
| Adjustment to reconcile net income | ||
| Depreciation expense | 30000 | |
| Loss on sale of plant assets | 10000 | |
| Account payable increase | 4000 | |
| Account receivable increase | -5000 | |
| Net cash flow from operating activities | 339000 | |
| Cash flow from investing activities | ||
| Plant assets purchased | -200000 | |
| Plant assets sold | 100000 | |
| Net cash flow from investing activities | -100000 | |
| Cash flow from financing activities | ||
| Dividend paid | -30000 | |
| Net cash flow from financing activities | -30000 | |
| Net cash flow | 209000 | |
| Beginning cash | 50000 | |
| Ending cash | 259000 | |
