You are provided with the following transactions that took place during a recent fiscal year.
![](/images/Accounting/scf/scf1.jpg)
Instructions
The following account balances relate to the stockholders equity accounts of Kerbs Corp. at year-end.
2020 | 2019 | |
Common stock, 10500 and 10,000 shares, respectively for 2020 and 2019. | $170,000 | $140,000 |
Preferred stock, 5,000 shares | 125,000 | 125,000 |
Retained earnings | 300,000 | 300,000 |
A small stock dividend was declared and issued in 2020. The market value of the shares was $10,500, cash dividends were $15,000 in both 2020 and 2019. The common stock has no par or stated value.
Instructions
- What was the amount of net income reported by Kerbs Corp. in 2020?
- Determine the amounts of any cash inflows or outflows related to the common stock and dividend accounts in 2020.
- Indicate where each of the cash inflows or outflows identified in (b) would be classified on the statement of cash flows
The income statement of Whitlock Company is presented here.
![](/images/Accounting/scf/scf3.jpg)
Additional information
- Accounts receivable increased $200,000 during the year, and inventory decreased $500,000.
- Prepaid expenses increased $150,000 during the year
- Accounts payable to suppliers of merchandise decreased $340,000 during the year.
- Accrued expenses payable decreased $100,000 during the year.
- Operating expenses include depreciation expense of $70,000
Instructions
Data for Whitlock Company are presented below
![](/images/Accounting/scf/scf3.jpg)
Additional information
- Accounts receivable increased $200,000 during the year, and inventory decreased $500,000.
- Prepaid expenses increased $150,000 during the year
- Accounts payable to suppliers of merchandise decreased $340,000 during the year.
- Accrued expenses payable decreased $100,000 during the year.
- Operating expenses include depreciation expense of $70,000
Instructions
Zumbrunn Company's income statement contained the condensed information below.
![](/images/Accounting/scf/scf5.jpg)
Accounts payable pertain to operating expenses.
Instructions
![](/images/Accounting/scf/scf5.jpg)
Accounts payable pertain to operating expenses.
Instructions
The following are the financial statements of Nosker Company.
Comparative Balance Sheets
December 31
![](/images/Accounting/scf/scf7.jpg)
Income Statement
For the Year Ended December 31, 2020
![](/images/Accounting/scf/scf71.jpg)
- Dividends declared and paid were $20,000.
- During the year equipment wassold for $8,500 cash. This equipment coast $18,000 originally and had a book value of $8,500 is in the operating expenses
- All depreciation expense $14,500 is in the operating expenses
- All sales and purchasers and on account.
Instructions
- Prepare a statement of cash flows using the indirect method.
- Compute free cash flow
Data for Nosker Company are presented in bellow.
Comparative Balance Sheets
December 31
![](/images/Accounting/scf/scf7.jpg)
Income Statement
For the Year Ended December 31, 2020
![](/images/Accounting/scf/scf71.jpg)
- Dividends declared and paid were $20,000.
- During the year equipment wassold for $8,500 cash. This equipment coast $18,000 originally and had a book value of $8,500 is in the operating expenses
- All depreciation expense $14,500 is in the operating expenses
- All sales and purchasers and on account.
- Accounts payable pertain to merchandise suppliers.
- All operating expenses except for depreciation were paid in cash
Instructions
- Prepare a statement of cash flows for Nosker Company using the direct method.
- Compute free cash flow
Condensed financial data of Cheng Inc. follow.
Comparative Balance Sheets
December 31
![](/images/Accounting/scf/scf9-q-1.jpg)
Income Statement
For the Year Ended December 31, 2019
![](/images/Accounting/scf/scf9-q-2.jpg)
- New equipment costing $85,000 was purchased for cash during the year.
- Old equipment having an original cost of $57,500 was sold for $1,500 cash.
- Bonds matured and were paid off at face value for cash.
- A cash dividend of $40,350 was declared and paid during the year.
Instructions
Data for cheng In. are presented in.
Comparative Balance Sheets
December 31
![](/images/Accounting/scf/scf9-q-1.jpg)
Income Statement
For the Year Ended December 31, 2019
![](/images/Accounting/scf/scf9-q-2.jpg)
- New equipment costing $85,000 was purchased for cash during the year.
- Old equipment having an original cost of $57,500 was sold for $1,500 cash.
- Bonds matured and were paid off at face value for cash.
- A cash dividend of $40,350 was declared and paid during the year.
Further analysis reveals that accounts payable pertain to merchandise creditors.