Ch 23 - Computational

The balance in retained earnings at December 31, 2017 was $1,440,000 and at December 31, 2018 was $1,164,000. Net income for 2018 was $1,000,000. A stock dividend was declared and distributed which increased common stock $500,000 and paid-in capital $220,000. A cash dividend was declared and paid. 69. The stock dividend should be reported on the statement of cash flows (indirect method) as a. an outflow from financing activities of $500,000. b. an outflow from financing activities of $720,000. c. an outflow from investing activities of $720,000. d. Stock dividends are not shown on a statement of cash flows.

d. Stock dividends are not shown on a statement of cash flows.

In preparing Titan Inc.'s statement of cash flows for the year ended December 31, 2018, the following amounts were available: Collect note receivable-----$615,000 Issue bonds payable---------639,000 Purchase treasury stock------300,000 What amount should be reported on Titan, Inc.'s statement of cash flows for investing activities? a. $615,000 b. $315,000 c. $1,254,000 d. $339,000

a. $615,000

The following information was taken from the 2018 financial statements of Jenny Gardner Corporation: Inventory, January 1, 2018-------------- $ 180,000 Inventory, December 31, 2018 -----------240,000 Accounts payable, January 1, 2018------- 150,000 Accounts payable, December 31, 2018 -240,000 Sales revenue --------------------------1,200,000 Cost of goods sold--------------------- 800,000 If the direct method is used in the 2018 statement of cash flows, what amount should Jenny Gardner report as cash payments to suppliers? a. $770,000 b. $830,000 c. $890,000 d. $950,000

a. $770,000

The net cash provided by operating activities in Sosa Company's statement of cash flows for 2018 was $310,000. For 2018, depreciation on plant assets was $90,000, amortization of patent was $16,000, and cash dividends paid on common stock was $108,000. Based only on the information given above, Sosa's net income for 2018 was a. $310,000. b. $204,000. c. $16,000. d. $312,000.

b. $204,000.

Equipment that cost $875,000 and had a book value of $390,000 was sold for $450,000. Data from the comparative balance sheets are: -------------------------------12/31/18------- 12/31/17 Equipment ------------------$5,400,000 --$4,875,000 Accumulated Depreciation- 1,650,000 ----1,425,000 62. Equipment purchased during 2018 was a. $1,400,000. b. $825,000. c. $525,000. d. $915,000.

a. $1,400,000.

Alex Company prepares its statement of cash flows using the direct method for operating activities. For the year ended December 31, 2018, Alex Company reports the following activity: Sales on account ------------------$2,100,000 Cash sales ----------------------------1,110,000 Decrease in accounts receivable ----915,000 Increase in accounts payable --------108,000 Increase in inventory ------------------72,000 Cost of good sold ------------------1,575,000 What is the amount of cash payments to suppliers reported by Alex Company for the year ended December 31, 2018? a. $1,539,000 b. $1,611,000 c. $1,755,000 d. $1,395,000

a. $1,539,000

Howell, Inc. reported net income of $88,000 for the year ended December 31, 2018. Included in net income was a gain on early extinguishment of debt of $120,000 related to bonds payable with a book value of $2,400,000. Each of the following accounts increased during 2018: Notes receivable---------$90,000 Deferred tax liability-----$20,000 Treasury stock----------$240,000 What is the amount of cash used by financing activities for Jarvis, Inc. for the year ended December 31, 2018? a. $2,520,000 b. $2,540,000 c. $3,800,000 d. $ 450,000

a. $2,520,000

Cashman Company reported net income of $530,000 for the year ended 12/31/18. Included in the computation of net income were: depreciation expense, $90,000; amortization of a patent, $48,000; income from an investment in common stock of Linda Inc., accounted for under the equity method, $72,000; and amortization of a bond premium, $18,000. Cashman also paid a $120,000 dividend during the year. The net cash provided by operating activities would be reported at a. $578,000. b. $482,000. c. $458,000. d. $362,000.

a. $578,000.

During 2018, Orton Company earned net income of $494,000 which included deprecia-tion expense of $78,000. In addition, the company experienced the following changes in the account balances listed below: -------------------Increases-------------------Decreases Accounts payable---$45,000-----Accounts receivable---$12,000 Inventory--------------36,000-----Accrued liabilities-------24,000 ----------------------------------------Prepaid insurance----33,000 Based upon this information what amount will be shown for net cash provided by operating activities for 2018? a. $602,000 b. $575,000 c. $395,000 d. $377,000

a. $602,000

The following information on selected cash transactions for 2018 has been provided by Mancuso Company: Proceeds from sale of land -------------------------$315,000 Proceeds from long-term borrowings --------------600,000 Purchases of plant assets -----------------------------216,000 Purchases of inventories ----------------------------1,020,000 Proceeds from sale of Mancuso common stock ----360,000 What is the cash provided (used) by investing activities for the year ended December 31, 2018, as a result of the above information? a. $99,000 b. $384,000. c. $315,000. d. $1,275,000.

a. $99,000

Napier Co. provided the following information on selected transactions during 2018: Purchase of land by issuing bonds-------------$1,000,000 Proceeds from issuing bonds-------------------3,000,000 Purchases of inventory--------------------------3,800,000 Purchases of treasury stock-----------------------600,000 Loans made to affiliated corporations----------1,400,000 Dividends paid to preferred stockholders-------400,000 Proceeds from issuing preferred stock---------1,600,000 Proceeds from sale of equipment----------------300,000 84. The net cash provided by financing activities during 2018 is a. $3,200,000. b. $3,600,000. c. $4,200,000. d. $4,600,000.

b. $3,600,000.

Napier Co. provided the following information on selected transactions during 2018: Purchase of land by issuing bonds-------------$1,000,000 Proceeds from issuing bonds-------------------3,000,000 Purchases of inventory--------------------------3,800,000 Purchases of treasury stock-----------------------600,000 Loans made to affiliated corporations----------1,400,000 Dividends paid to preferred stockholders-------400,000 Proceeds from issuing preferred stock---------1,600,000 Proceeds from sale of equipment----------------300,000 83. The net cash provided (used) by investing activities during 2018 is a. $300,000. b. $(1,100,000). c. $(2,100,000). d. $(4,500,000).

b. $(1,100,000).

Fleming Company provided the following information on selected transactions during 2018: Dividends paid to preferred stockholders -----------$ 500,000 Loans made to affiliated corporations ----------------1,400,000 Proceeds from issuing bonds -------------------------1,600,000 Proceeds from issuing preferred stock ---------------2,100,000 Proceeds from sale of equipment ---------------------800,000 Purchases of inventories -----------------------------2,400,000 Purchase of land by issuing bonds --------------------600,000 Purchases of treasury stock --------------------------1,200,000 98. The net cash provided (used) by investing activities during 2018 is a. $(1,200,000). b. $(600,000). c. $200,000. d. $800,000.

b. $(600,000).

Putnam, Inc. Comparative Balance Sheets December 31, -----------------------------------------2019----------------------2018 Assets: Current Assets: Cash-------------------------------$ 1,380,000--------------$1,080,000 Accounts Receivable (net)----------3,120,000---------------2,160,000 Inventory ---------------------------3,900,000---------------2,520,000 Prepaid Expenses --------------------702,000 ----------------630,000 -----Total Current Assets-----------=9,102,000--------------=6,390,000 Long-Term Investments---------------450,000 Plant Assets: Property, Plant & Equipment=------4,380,000---------------2,880,000 Accumulated Depreciation--------(900,000)---------------(540,000) ------Total Plant Assets-----------=3,480,000--------------=2,340,000 --Total Assets-------------------=$13,032,000-------------=$8,730,000 Equities: Current Liabilities: Accounts Payable -------------$ 2,550,000----------------$2,190,000 Accrued Expenses-----------------618,000-------------------564,000 Dividends Payable-----------------402,000 --Total Current Liabilities--------=3,570,000------------------=754,000 Long-Term Notes Payable--------1,650,000 Stockholders' Equity: Common Stock------------------6,000,000-----------------4,800,000 Retained Earnings-----------------1,812,000------------------1,176,000 ---Total Equities----------------$13,032,000----------------$8,730,000 Putnam, Inc. Comparative Income Statements December 31, ----------------------------------------2019---------------------2018 Net Credit Sales -------------$14,040,000----------------$7,506,000 Cost of Goods Sold------------7,830,000------------------3,762,000 Gross Profit--------------------=6,210,000-----------------=3,744,000 Operating Expenses (including Income Tax) ---------5,172,000------------------2,748,000 Net Income ------------------=$1,038,000----------------=$ 996,000 Additional Information: a. Accounts receivable and accounts payable relate to merchandise held for sale in the normal course of business. The allowance for bad debts was the same at the end of 2019 and 2018, and no receivables were charged against the allowance. Accounts payable are recorded net of any discount and are always paid within the discount period. b. The proceeds from the note payable were used to finance the acquisition of property, plant, and equipment. Capital stock was sold to provide additional working capital. 97. The amount to be shown on the cash flow statement as net cash provided by financing activities would total what amount? a. $2,850,000. b. $1,650,000. c. $1,200,000. d. $816,000.

a. $2,850,000.

Financial statements for Kiner Company are given below: Kiner Company Balance Sheet January 1, 2018 Assets------------------------------------------Equities Cash-------------------------$960,000--------Accounts payable--$456,000 Accounts receivable---------864,000 Buildings and equipment---3,600,000 Accumulated depreciation— buildings and equipment--(1,200,000)-------Common stock----2,760,000 Patents------------------------432,000-------Retained earnings--1,440,000 -----------------------------$4,656,000---------------------------$4,656,000 Kiner Company Statement of Cash Flows For the Year Ended December 31, 2018 Increase (Decrease) in Cash Cash flows from operating activities Net income---------------------------------------------------------$1,200,000 Adjustments to reconcile net income to net cash provided by operating activities: ---Increase in accounts receivable----------------$(384,000) ---Increase in accounts payable-----------------------192,000 ---Depreciation—buildings and equipment-----------360,000 ---Gain on sale of equipment------------------------(144,000) ---Amortization of patents-----------------------------48,000--------+72,000 Net cash provided by operating activities--------------------------1,272,000 Cash flows from investing activities ---Sale of equipment----------------------------------288,000 ---Purchase of land----------------------------------(600,000) ---Purchase of buildings and equipment-----------(1,152,000) Net cash used by investing activities----------------------------(1,464,000) Cash flows from financing activities ---Payment of cash dividend------------------------(360,000) ---Sale of common stock------------------------------960,000 Net cash provided by financing activities-------------------------600,000 Net increase in cash-----------------------------------------------=408,000 Cash, January 1, 2018-----------------------------------------------+960,000 Cash, December 31, 2018----------------------------------------=$1,368,000 Total assets on the balance sheet at December 31, 2018 are $6,648,000. Accumulated deprecia-tion on the equipment sold was $336,000. 64. The book value of the buildings and equipment at December 31, 2018 was a. $3,048,000. b. $3,120,000. c. $4,272,000. d. $3,528,000.

a. $3,048,000.

During 2018, Greta Company earned net income of $262,000 which included depreciation expense of $39,000. In addition, the company experienced the following changes in the account balances listed below: ---------------------Decreases--------------------Increases Accounts receivable--$6,000------------Accounts payable---$22,500 Prepaid expenses-----16,500-------------Inventory--------------18,000 Accrued liabilities------12,000 Based upon this information what amount will be shown for net cash provided by operating activities for 2018? a. $316,000. b. $302,500. c. $212,500. d. $203,500.

a. $316,000.

Lindsay Corporation had net income for 2018 of $3,000,000. Additional information is as follows: Depreciation of plant assets-----------$1,200,000 Amortization of intangibles---------------240,000 Increase in accounts receivable----------420,000 Increase in accounts payable-------------540,000 Lindsay's net cash provided by operating activities for 2018 was a. $4,560,000. b. $4,440,000. c. $4,320,000. d. $2,680,000.

a. $4,560,000.

Harlan Mining Co. has recently decided to go public and has hired you as an independent CPA. One statement that the enterprise is anxious to have prepared is a statement of cash flows. Financial statements of Harlan Mining Co. for 2019 and 2018 are provided below. BALANCE SHEETS --------------------------------------------12/31/19------------------ 12/31/18 Cash ------------------------------------$408,000---------------- $ 192,000 Accounts receivable---------------------360,000-------------------216,000 Inventory---------------------------------384,000------------------480,000 Property, plant and equipment---$608,000 --------------$960,000 Less accumulated depreciation--(320,000)=288,000-----(304,000)=656,000 -------------------------------------------$1,440,000------------$1,544,000 Accounts payable------------------------$ 176,000------------------$ 96,000 Income taxes payable---------------------352,000-------------------392,000 Bonds payable-----------------------------360,000------------------600,000 Common stock-----------------------------216,000--------------------216,000 Retained earnings-------------------------336,000-------------------240,000 ------------------------------------------$1,440,000-----------------$1,544,000 INCOME STATEMENT For the Year Ended December 31, 2019 Sales revenue----------------------------$8,400,000 Cost of sales-----------------------------(7,152,000) Gross profit-----------------------------=1,248,000 Selling expenses---------$600,000 Administrative expenses=+192,000------=(792,000) Income from operations-----------------=456,000 Interest expense---------------------------(72,000) Income before taxes---------------------=384,000 Income taxes------------------------------(96,000) Net income------------------------------=$ 288,000 The following additional data were provided: 1. Dividends for the year 2019 were $192,000. 2. During the year, equipment was sold for $240,000. This equipment cost $352,000 originally and had a book value of $288,000 at the time of sale. The loss on sale was incorrectly charged to cost of sales. 3. All depreciation expense is in the selling expense category. 51. The net cash provided by operating activities is a. $408,000. b. $288,000. c. $240,000. d. $200,000.

a. $408,000.

During 2018, Oldham Corporation, which uses the allowance method of accounting for doubtful accounts, recorded a provision for bad debt expense of $45,000 and in addition it wrote off, as uncollectible, accounts receivable of $10,000. As a result of these transactions, net cash flows from operating activities would be calculated (indirect method) by adjusting net income with a a. $45,000 increase. b. $10,000 increase. c. $35,000 increase. d. $35,000 decrease.

a. $45,000 increase.

Net cash flow from operating activities for 2018 for Spencer Corporation was $450,000. The following items are reported on the financial statements for 2018: Cash dividends paid on common stock----------$20,000 Depreciation and amortization----------------------12,000 Increase in accounts receivable--------------------24,000 Based on the information above, Spencer's net income for 2018 was a. $462,000. b. $446,000. c. $414,000. d. $406,000.

a. $462,000.

Minear Company reported net income of $480,000 for the year ended 12/31/18. Included in the computation of net income were: depreciation expense, $60,000; amortization of a patent, $32,000; income from an investment in common stock of Brett Inc., accounted for under the equity method, $48,000; and amortization of a bond discount, $12,000. Minear also paid an $80,000 dividend during the year. The net cash provided by operating activities would be reported at a. $536,000. b. $456,000. c. $424,000. d. $344,000.

a. $536,000.

The net income for the year ended December 31, 2018, for Oliva Company was $2,900,000. Additional information is as follows: Depreciation on plant assets ---------------------------------$600,000 Amortization of leasehold improvements ---------------------340,000 Provision for doubtful accounts on short-term receivables--- 120,000 Provision for doubtful accounts on long-term receivables ---100,000 Interest paid on short-term borrowings ------------------------80,000 Interest paid on long-term borrowings ------------------------60,000 Based solely on the information given above, what should be the net cash provided by operating activities in the statement of cash flows for the year ended December 31, 2018? a. $3,960,000. b. $4,060,000. c. $4,040,000. d. $4,200,000.

b. $4,060,000.

The balance in retained earnings at December 31, 2017 was $1,440,000 and at December 31, 2018 was $1,164,000. Net income for 2018 was $1,000,000. A stock dividend was declared and distributed which increased common stock $500,000 and paid-in capital $220,000. A cash dividend was declared and paid. 68. The amount of the cash dividend was a. $496,000. b. $556,000. c. $776,000. d. $1,276,000.

b. $556,000.

Financial statements for Kiner Company are given below: Kiner Company Balance Sheet January 1, 2018 Assets------------------------------------------Equities Cash-------------------------$960,000--------Accounts payable--$456,000 Accounts receivable---------864,000 Buildings and equipment---3,600,000 Accumulated depreciation— buildings and equipment--(1,200,000)-------Common stock----2,760,000 Patents------------------------432,000-------Retained earnings--1,440,000 -----------------------------$4,656,000---------------------------$4,656,000 Kiner Company Statement of Cash Flows For the Year Ended December 31, 2018 Increase (Decrease) in Cash Cash flows from operating activities Net income---------------------------------------------------------$1,200,000 Adjustments to reconcile net income to net cash provided by operating activities: ---Increase in accounts receivable----------------$(384,000) ---Increase in accounts payable-----------------------192,000 ---Depreciation—buildings and equipment-----------360,000 ---Gain on sale of equipment------------------------(144,000) ---Amortization of patents-----------------------------48,000--------+72,000 Net cash provided by operating activities--------------------------1,272,000 Cash flows from investing activities ---Sale of equipment----------------------------------288,000 ---Purchase of land----------------------------------(600,000) ---Purchase of buildings and equipment-----------(1,152,000) Net cash used by investing activities----------------------------(1,464,000) Cash flows from financing activities ---Payment of cash dividend------------------------(360,000) ---Sale of common stock------------------------------960,000 Net cash provided by financing activities-------------------------600,000 Net increase in cash-----------------------------------------------=408,000 Cash, January 1, 2018-----------------------------------------------+960,000 Cash, December 31, 2018----------------------------------------=$1,368,000 Total assets on the balance sheet at December 31, 2018 are $6,648,000. Accumulated deprecia-tion on the equipment sold was $336,000. 65. The accounts payable at December 31, 2018 were a. $264,000. b. $648,000. c. $192,000. d. $888,000.

b. $648,000.

Equipment that cost $875,000 and had a book value of $390,000 was sold for $450,000. Data from the comparative balance sheets are: -------------------------------12/31/18------- 12/31/17 Equipment ------------------$5,400,000 --$4,875,000 Accumulated Depreciation- 1,650,000 ----1,425,000 61. Depreciation expense for 2018 was a. $770,000. b. $710,000. c. $135,000. d. $90,000.

b. $710,000.

Harlan Mining Co. has recently decided to go public and has hired you as an independent CPA. One statement that the enterprise is anxious to have prepared is a statement of cash flows. Financial statements of Harlan Mining Co. for 2019 and 2018 are provided below. BALANCE SHEETS --------------------------------------------12/31/19------------------ 12/31/18 Cash ------------------------------------$408,000---------------- $ 192,000 Accounts receivable---------------------360,000-------------------216,000 Inventory---------------------------------384,000------------------480,000 Property, plant and equipment---$608,000 --------------$960,000 Less accumulated depreciation--(320,000)=288,000-----(304,000)=656,000 -------------------------------------------$1,440,000------------$1,544,000 Accounts payable------------------------$ 176,000------------------$ 96,000 Income taxes payable---------------------352,000-------------------392,000 Bonds payable-----------------------------360,000------------------600,000 Common stock-----------------------------216,000--------------------216,000 Retained earnings-------------------------336,000-------------------240,000 ------------------------------------------$1,440,000-----------------$1,544,000 INCOME STATEMENT For the Year Ended December 31, 2019 Sales revenue----------------------------$8,400,000 Cost of sales-----------------------------(7,152,000) Gross profit-----------------------------=1,248,000 Selling expenses---------$600,000 Administrative expenses=+192,000------=(792,000) Income from operations-----------------=456,000 Interest expense---------------------------(72,000) Income before taxes---------------------=384,000 Income taxes------------------------------(96,000) Net income------------------------------=$ 288,000 The following additional data were provided: 1. Dividends for the year 2019 were $192,000. 2. During the year, equipment was sold for $240,000. This equipment cost $352,000 originally and had a book value of $288,000 at the time of sale. The loss on sale was incorrectly charged to cost of sales. 3. All depreciation expense is in the selling expense category. 53. Under the direct method, the cash received from customers is a. $8,544,000. b. $8,256,000. c. $8,400,000. d. $8,440,000.

b. $8,256,000.

Putnam, Inc. Comparative Balance Sheets December 31, -----------------------------------------2019----------------------2018 Assets: Current Assets: Cash-------------------------------$ 1,380,000--------------$1,080,000 Accounts Receivable (net)----------3,120,000---------------2,160,000 Inventory ---------------------------3,900,000---------------2,520,000 Prepaid Expenses --------------------702,000 ----------------630,000 -----Total Current Assets-----------=9,102,000--------------=6,390,000 Long-Term Investments---------------450,000 Plant Assets: Property, Plant & Equipment=------4,380,000---------------2,880,000 Accumulated Depreciation--------(900,000)---------------(540,000) ------Total Plant Assets-----------=3,480,000--------------=2,340,000 --Total Assets-------------------=$13,032,000-------------=$8,730,000 Equities: Current Liabilities: Accounts Payable -------------$ 2,550,000----------------$2,190,000 Accrued Expenses-----------------618,000-------------------564,000 Dividends Payable-----------------402,000 --Total Current Liabilities--------=3,570,000------------------=754,000 Long-Term Notes Payable--------1,650,000 Stockholders' Equity: Common Stock------------------6,000,000-----------------4,800,000 Retained Earnings-----------------1,812,000------------------1,176,000 ---Total Equities----------------$13,032,000----------------$8,730,000 Putnam, Inc. Comparative Income Statements December 31, ----------------------------------------2019---------------------2018 Net Credit Sales -------------$14,040,000----------------$7,506,000 Cost of Goods Sold------------7,830,000------------------3,762,000 Gross Profit--------------------=6,210,000-----------------=3,744,000 Operating Expenses (including Income Tax) ---------5,172,000------------------2,748,000 Net Income ------------------=$1,038,000----------------=$ 996,000 Additional Information: a. Accounts receivable and accounts payable relate to merchandise held for sale in the normal course of business. The allowance for bad debts was the same at the end of 2019 and 2018, and no receivables were charged against the allowance. Accounts payable are recorded net of any discount and are always paid within the discount period. b. The proceeds from the note payable were used to finance the acquisition of property, plant, and equipment. Capital stock was sold to provide additional working capital. 95. What amount of cash was paid on accounts payable to suppliers during 2019? a. $9,210,000. b. $8,850,000. c. $8,190,000. d. $7,470,000.

b. $8,850,000.

An analysis of the machinery accounts of Noller Company for 2018 is as follows: -------------------------------(Machinery) (Accum. Dep) (Machinery Net AD) Balance at January 1, 2018--- $500,000 -----$125,000 --------$375,000 Purchases of new machinery in 2018 for cash--------------- 200,000 ---------0----------------200,000 Depreciation in 2018------------0-----------100,000-------------(100,000) Balance at Dec. 31, 2018 ---$700,000---- $225,000-------------$475,000 The information concerning Noller's machinery accounts should be shown in Noller's statement of cash flows (indirect method) for the year ended December 31, 2018, as a(n) a. subtraction from net income of $100,000 and a $200,000 decrease in cash flows from financing activities. b. addition to net income of $100,000 and a $200,000 decrease in cash flows from investing activities. c. $100,000 increase in cash flows from financing activities. d. $200,000 decrease in cash flows from investing activities.

b. addition to net income of $100,000 and a $200,000 decrease in cash flows from investing activities.

A flood damaged a building and contents. The receipts from insurance companies totaled $600,000, which was $180,000 less than the book values. The tax rate is 30%. 103. On the statement of cash flows (indirect method), the flood loss should a. be shown as an addition to net income of $126,000. b. be shown as an addition to net income of $180,000. c. be shown as an inflow from investing activities of $126,000. d. not be shown.

b. be shown as an addition to net income of $180,000.

Harlan Mining Co. has recently decided to go public and has hired you as an independent CPA. One statement that the enterprise is anxious to have prepared is a statement of cash flows. Financial statements of Harlan Mining Co. for 2019 and 2018 are provided below. BALANCE SHEETS --------------------------------------------12/31/19------------------ 12/31/18 Cash ------------------------------------$408,000---------------- $ 192,000 Accounts receivable---------------------360,000-------------------216,000 Inventory---------------------------------384,000------------------480,000 Property, plant and equipment---$608,000 --------------$960,000 Less accumulated depreciation--(320,000)=288,000-----(304,000)=656,000 -------------------------------------------$1,440,000------------$1,544,000 Accounts payable------------------------$ 176,000------------------$ 96,000 Income taxes payable---------------------352,000-------------------392,000 Bonds payable-----------------------------360,000------------------600,000 Common stock-----------------------------216,000--------------------216,000 Retained earnings-------------------------336,000-------------------240,000 ------------------------------------------$1,440,000-----------------$1,544,000 INCOME STATEMENT For the Year Ended December 31, 2019 Sales revenue----------------------------$8,400,000 Cost of sales-----------------------------(7,152,000) Gross profit-----------------------------=1,248,000 Selling expenses---------$600,000 Administrative expenses=+192,000------=(792,000) Income from operations-----------------=456,000 Interest expense---------------------------(72,000) Income before taxes---------------------=384,000 Income taxes------------------------------(96,000) Net income------------------------------=$ 288,000 The following additional data were provided: 1. Dividends for the year 2019 were $192,000. 2. During the year, equipment was sold for $240,000. This equipment cost $352,000 originally and had a book value of $288,000 at the time of sale. The loss on sale was incorrectly charged to cost of sales. 3. All depreciation expense is in the selling expense category. 55. The net cash provided (used) by financing activities is a. $(240,000). b. $48,000. c. $(432,000). d. $192,000.

c. $(432,000).

The balance sheet data of Kohler Company at the end of 2018 and 2017 follow: ---------------------------------------------2018----------------------2017 Cash----------------------------------$ 100,000-----------------$ 140,000 Accounts receivable (net)------------240,000--------------------180,000 Inventory------------------------------280,000--------------------180,000 Prepaid expenses----------------------40,000--------------------100,000 Buildings and equipment-------------360,000--------------------300,000 Accumulated depreciation buildings and equipment--------------(72,000)-------------------(32,000) Land-----------------------------------360,000--------------------160,000 Totals-------------------------------$1,308,000-----------------$1,028,000 Accounts payable-------------------$272,000-------------------$220,000 Accrued expenses--------------------48,000----------------------72,000 Notes payable—bank, long-term---------------------------------160,000 Mortgage payable--------------------120,000 Common stock, $10 par--------------836,000-------------------636,000 Retained earnings (deficit)------------32,000--------------------(60,000) Totals-----------------------------$1,308,000------------------$1,028,000 Land was acquired for $200,000 in exchange for common stock, par $200,000, during the year; all equipment purchased was for cash. Equipment costing $20,000 was sold for $8,000; book value of the equipment was $16,000 and the loss was reported as an ordinary item in net income. Cash dividends of $30,000 were charged to retained earnings and paid during the year; the transfer of net income to retained earnings was the only other entry in the Retained Earnings account. In the statement of cash flows for the year ended December 31, 2018, for Naley Company: 87. The net cash provided (used) by financing activities was a. $ -0-. b. $(30,000). c. $(70,000). d. $120,000.

c. $(70,000).

The balance sheet data of Kohler Company at the end of 2018 and 2017 follow: ---------------------------------------------2018----------------------2017 Cash----------------------------------$ 100,000-----------------$ 140,000 Accounts receivable (net)------------240,000--------------------180,000 Inventory------------------------------280,000--------------------180,000 Prepaid expenses----------------------40,000--------------------100,000 Buildings and equipment-------------360,000--------------------300,000 Accumulated depreciation buildings and equipment--------------(72,000)-------------------(32,000) Land-----------------------------------360,000--------------------160,000 Totals-------------------------------$1,308,000-----------------$1,028,000 Accounts payable-------------------$272,000-------------------$220,000 Accrued expenses--------------------48,000----------------------72,000 Notes payable—bank, long-term---------------------------------160,000 Mortgage payable--------------------120,000 Common stock, $10 par--------------836,000-------------------636,000 Retained earnings (deficit)------------32,000--------------------(60,000) Totals-----------------------------$1,308,000------------------$1,028,000 Land was acquired for $200,000 in exchange for common stock, par $200,000, during the year; all equipment purchased was for cash. Equipment costing $20,000 was sold for $8,000; book value of the equipment was $16,000 and the loss was reported as an ordinary item in net income. Cash dividends of $30,000 were charged to retained earnings and paid during the year; the transfer of net income to retained earnings was the only other entry in the Retained Earnings account. In the statement of cash flows for the year ended December 31, 2018, for Naley Company: 85. The net cash provided by operating activities was a. $94,000. b. $122,000. c. $102,000. d. $86,000.

c. $102,000.

The following information was taken from the 2018 financial statements of Dunlop Corporation: Bonds payable, January 1, 2018---------$ 800,000 Bonds payable, December 31, 2018----4,800,000 During 2018 • A $720,000 payment was made to retire bonds payable with a face amount of $800,000. • Bonds payable with a face amount of $320,000 were issued in exchange for equipment. In its statement of cash flows for the year ended December 31, 2018, what amount should Dunlop report as proceeds from issuance of bonds payable? a. $4,000,000 b. $4,400,000 c. $4,480,000 d. $5,120,000

c. $4,480,000

Putnam, Inc. Comparative Balance Sheets December 31, -----------------------------------------2019----------------------2018 Assets: Current Assets: Cash-------------------------------$ 1,380,000--------------$1,080,000 Accounts Receivable (net)----------3,120,000---------------2,160,000 Inventory ---------------------------3,900,000---------------2,520,000 Prepaid Expenses --------------------702,000 ----------------630,000 -----Total Current Assets-----------=9,102,000--------------=6,390,000 Long-Term Investments---------------450,000 Plant Assets: Property, Plant & Equipment=------4,380,000---------------2,880,000 Accumulated Depreciation--------(900,000)---------------(540,000) ------Total Plant Assets-----------=3,480,000--------------=2,340,000 --Total Assets-------------------=$13,032,000-------------=$8,730,000 Equities: Current Liabilities: Accounts Payable -------------$ 2,550,000----------------$2,190,000 Accrued Expenses-----------------618,000-------------------564,000 Dividends Payable-----------------402,000 --Total Current Liabilities--------=3,570,000------------------=754,000 Long-Term Notes Payable--------1,650,000 Stockholders' Equity: Common Stock------------------6,000,000-----------------4,800,000 Retained Earnings-----------------1,812,000------------------1,176,000 ---Total Equities----------------$13,032,000----------------$8,730,000 Putnam, Inc. Comparative Income Statements December 31, ----------------------------------------2019---------------------2018 Net Credit Sales -------------$14,040,000----------------$7,506,000 Cost of Goods Sold------------7,830,000------------------3,762,000 Gross Profit--------------------=6,210,000-----------------=3,744,000 Operating Expenses (including Income Tax) ---------5,172,000------------------2,748,000 Net Income ------------------=$1,038,000----------------=$ 996,000 Additional Information: a. Accounts receivable and accounts payable relate to merchandise held for sale in the normal course of business. The allowance for bad debts was the same at the end of 2019 and 2018, and no receivables were charged against the allowance. Accounts payable are recorded net of any discount and are always paid within the discount period. b. The proceeds from the note payable were used to finance the acquisition of property, plant, and equipment. Capital stock was sold to provide additional working capital. 94. What amount of cash was collected from 2019 accounts receivable? a. $15,000,000. b. $14,040,000. c. $13,080,000. d. $6,540,000.

c. $13,080,000.

Financial statements for Kiner Company are given below: Kiner Company Balance Sheet January 1, 2018 Assets------------------------------------------Equities Cash-------------------------$960,000--------Accounts payable--$456,000 Accounts receivable---------864,000 Buildings and equipment---3,600,000 Accumulated depreciation— buildings and equipment--(1,200,000)-------Common stock----2,760,000 Patents------------------------432,000-------Retained earnings--1,440,000 -----------------------------$4,656,000---------------------------$4,656,000 Kiner Company Statement of Cash Flows For the Year Ended December 31, 2018 Increase (Decrease) in Cash Cash flows from operating activities Net income---------------------------------------------------------$1,200,000 Adjustments to reconcile net income to net cash provided by operating activities: ---Increase in accounts receivable----------------$(384,000) ---Increase in accounts payable-----------------------192,000 ---Depreciation—buildings and equipment-----------360,000 ---Gain on sale of equipment------------------------(144,000) ---Amortization of patents-----------------------------48,000--------+72,000 Net cash provided by operating activities--------------------------1,272,000 Cash flows from investing activities ---Sale of equipment----------------------------------288,000 ---Purchase of land----------------------------------(600,000) ---Purchase of buildings and equipment-----------(1,152,000) Net cash used by investing activities----------------------------(1,464,000) Cash flows from financing activities ---Payment of cash dividend------------------------(360,000) ---Sale of common stock------------------------------960,000 Net cash provided by financing activities-------------------------600,000 Net increase in cash-----------------------------------------------=408,000 Cash, January 1, 2018-----------------------------------------------+960,000 Cash, December 31, 2018----------------------------------------=$1,368,000 Total assets on the balance sheet at December 31, 2018 are $6,648,000. Accumulated deprecia-tion on the equipment sold was $336,000. 66. The balance in the Retained Earnings account at December 31, 2018 was a. $1,080,000. b. $2,640,000. c. $2,280,000. d. $3,000,000.

c. $2,280,000.

Howell, Inc. reported net income of $88,000 for the year ended December 31, 2018 Included in net income were depreciation expense of $16,800 and a gain on sale of equipment of $3,400. The equipment had an historical cost of $80,000 and accumulated depreciation of $48,000. Each of the following accounts increased during 2018: Land------------------------------$11,000 Prepaid rent---------------------$13,600 Available-for-sale securities-----$2,000 Bonds payable------------------$10,000 What is the amount of cash provided by or used by investing activities for Jarvis, Inc. for the year ended December 31, 2018? a. ( $ 9,600) b. $33,400 c. $22,400 d. $24,400

c. $22,400

Harlan Mining Co. has recently decided to go public and has hired you as an independent CPA. One statement that the enterprise is anxious to have prepared is a statement of cash flows. Financial statements of Harlan Mining Co. for 2019 and 2018 are provided below. BALANCE SHEETS --------------------------------------------12/31/19------------------ 12/31/18 Cash ------------------------------------$408,000---------------- $ 192,000 Accounts receivable---------------------360,000-------------------216,000 Inventory---------------------------------384,000------------------480,000 Property, plant and equipment---$608,000 --------------$960,000 Less accumulated depreciation--(320,000)=288,000-----(304,000)=656,000 -------------------------------------------$1,440,000------------$1,544,000 Accounts payable------------------------$ 176,000------------------$ 96,000 Income taxes payable---------------------352,000-------------------392,000 Bonds payable-----------------------------360,000------------------600,000 Common stock-----------------------------216,000--------------------216,000 Retained earnings-------------------------336,000-------------------240,000 ------------------------------------------$1,440,000-----------------$1,544,000 INCOME STATEMENT For the Year Ended December 31, 2019 Sales revenue----------------------------$8,400,000 Cost of sales-----------------------------(7,152,000) Gross profit-----------------------------=1,248,000 Selling expenses---------$600,000 Administrative expenses=+192,000------=(792,000) Income from operations-----------------=456,000 Interest expense---------------------------(72,000) Income before taxes---------------------=384,000 Income taxes------------------------------(96,000) Net income------------------------------=$ 288,000 The following additional data were provided: 1. Dividends for the year 2019 were $192,000. 2. During the year, equipment was sold for $240,000. This equipment cost $352,000 originally and had a book value of $288,000 at the time of sale. The loss on sale was incorrectly charged to cost of sales. 3. All depreciation expense is in the selling expense category. 52. The net cash provided (used) by investing activities is a. $(352,000). b. $48,000. c. $240,000. d. $(288,000).

c. $240,000.

During 2018, Stout Inc. had the following activities related to its financial operations: Carrying value of convertible preferred stock in Stout, converted into common shares of Stout----------------------$ 540,000 Payment in 2018 of cash dividend declared in 2017 to preferred shareholders-------------------------------------------279,000 Payment for the early retirement of long-term bonds payable (carrying amount $3,930,000)----------------------------------3,975,000 Proceeds from the sale of treasury stock (on books at cost of $387,000)----------------------------------450,000 The amount of net cash used in financing activities to appear in Stout's statement of cash flows for 2018 should be a. $2,985,000. b. $3,264,000. c. $3,804,000. d. $3,822,000.

c. $3,804,000.

In preparing Titan Inc.'s statement of cash flows for the year ended December 31, 2018, the following amounts were available: Collect note receivable-----$615,000 Issue bonds payable---------639,000 Purchase treasury stock------300,000 What amount should be reported on Titan, Inc's statement of cash flows for financing activities? a. $ 24,000 b. $1,254,000 c. $339,000 d. $315,000

c. $339,000

Donnegan Company reported operating expenses of $375,000 for 2018. The following data were extracted from the company's financial records: ----------------------12/31/17 12/31/18 Prepaid Expenses $ 60,000 $69,000 Accrued Expenses 210,000 255,000 On a statement of cash flows for 2018, using the direct method, cash payments for operating expenses should be a. $429,000. b. $411,000. c. $339,000. d. $321,000.

c. $339,000.

Alex Company prepares its statement of cash flows using the direct method for operating activities. For the year ended December 31, 2018, Alex Company reports the following activity: Sales on account ------------------$2,100,000 Cash sales ----------------------------1,110,000 Decrease in accounts receivable ----915,000 Increase in accounts payable --------108,000 Increase in inventory ------------------72,000 Cost of good sold ------------------1,575,000 What is the amount of cash collections from customers reported by Alex Company for the year ended December 31, 2018? a. $3,210,000 b. $3,015,000 c. $4,125,000 d. $2,295,000

c. $4,125,000

Financial statements for Kiner Company are given below: Kiner Company Balance Sheet January 1, 2018 Assets------------------------------------------Equities Cash-------------------------$960,000--------Accounts payable--$456,000 Accounts receivable---------864,000 Buildings and equipment---3,600,000 Accumulated depreciation— buildings and equipment--(1,200,000)-------Common stock----2,760,000 Patents------------------------432,000-------Retained earnings--1,440,000 -----------------------------$4,656,000---------------------------$4,656,000 Kiner Company Statement of Cash Flows For the Year Ended December 31, 2018 Increase (Decrease) in Cash Cash flows from operating activities Net income---------------------------------------------------------$1,200,000 Adjustments to reconcile net income to net cash provided by operating activities: ---Increase in accounts receivable----------------$(384,000) ---Increase in accounts payable-----------------------192,000 ---Depreciation—buildings and equipment-----------360,000 ---Gain on sale of equipment------------------------(144,000) ---Amortization of patents-----------------------------48,000--------+72,000 Net cash provided by operating activities--------------------------1,272,000 Cash flows from investing activities ---Sale of equipment----------------------------------288,000 ---Purchase of land----------------------------------(600,000) ---Purchase of buildings and equipment-----------(1,152,000) Net cash used by investing activities----------------------------(1,464,000) Cash flows from financing activities ---Payment of cash dividend------------------------(360,000) ---Sale of common stock------------------------------960,000 Net cash provided by financing activities-------------------------600,000 Net increase in cash-----------------------------------------------=408,000 Cash, January 1, 2018-----------------------------------------------+960,000 Cash, December 31, 2018----------------------------------------=$1,368,000 Total assets on the balance sheet at December 31, 2018 are $6,648,000. Accumulated deprecia-tion on the equipment sold was $336,000. 63. When the equipment was sold, the Buildings and Equipment account received a credit of a. $288,000. b. $624,000. c. $480,000. d. $336,000.

c. $480,000.

During 2018, equipment was sold for $468,000. The equipment cost $786,000 and had a book value of $432,000. Accumulated Depreciation—Equipment was $2,061,000 at 12/31/17 and $2,205,000 at 12/31/18. Depreciation expense for 2018 was a. $144,000. b. $288,000. c. $498,000. d. $576,000.

c. $498,000.

Zook Incorporated, had net income for 2018 of $5,400,000. Additional information is as follows: Amortization of patents ----------------$ 45,000 Depreciation on plant assets ----------1,650,000 Long-term debt: Bond premium amortization -------------65,000 Interest paid -----------------------------900,000 Provision for doubtful accounts: Current receivables ----------------------80,000 Long-term nontrade receivables --------30,000 What should be the net cash provided by operating activities in the statement of cash flows for the year ended December 31, 2018, based solely on the above information? a. $7,220,000. b. $7,270,000. c. $7,140,000. d. $7,240,000.

c. $7,140,000.

A flood damaged a building and contents. The receipts from insurance companies totaled $600,000, which was $180,000 less than the book values. The tax rate is 30%. 102. On the statement of cash flows (indirect method), the receipts from insurance companies should a. be shown as an addition to net income of $420,000. b. be shown as an inflow from investing activities of $420,000. c. be shown as an inflow from investing activities of $600,000. d. not be shown.

c. be shown as an inflow from investing activities of $600,000.

Hager Company sold some of its plant assets during 2018. The original cost of the plant assets was $900,000 and the accumulated depreciation at date of sale was $840,000. The proceeds from the sale of the plant assets were $90,000. The information concerning the sale of the plant assets should be shown on Hager's statement of cash flows (indirect method) for the year ended December 31, 2018, as a(n) a. subtraction from net income of $30,000 and a $60,000 increase in cash flows from financing activities. b. addition to net income of $30,000 and a $90,000 increase in cash flows from investing activities. c. subtraction from net income of $30,000 and a $90,000 increase in cash flows from investing activities. d. addition of $90,000 to net income.

c. subtraction from net income of $30,000 and a $90,000 increase in cash flows from investing activities.

The balance sheet data of Kohler Company at the end of 2018 and 2017 follow: ---------------------------------------------2018----------------------2017 Cash----------------------------------$ 100,000-----------------$ 140,000 Accounts receivable (net)------------240,000--------------------180,000 Inventory------------------------------280,000--------------------180,000 Prepaid expenses----------------------40,000--------------------100,000 Buildings and equipment-------------360,000--------------------300,000 Accumulated depreciation buildings and equipment--------------(72,000)-------------------(32,000) Land-----------------------------------360,000--------------------160,000 Totals-------------------------------$1,308,000-----------------$1,028,000 Accounts payable-------------------$272,000-------------------$220,000 Accrued expenses--------------------48,000----------------------72,000 Notes payable—bank, long-term---------------------------------160,000 Mortgage payable--------------------120,000 Common stock, $10 par--------------836,000-------------------636,000 Retained earnings (deficit)------------32,000--------------------(60,000) Totals-----------------------------$1,308,000------------------$1,028,000 Land was acquired for $200,000 in exchange for common stock, par $200,000, during the year; all equipment purchased was for cash. Equipment costing $20,000 was sold for $8,000; book value of the equipment was $16,000 and the loss was reported as an ordinary item in net income. Cash dividends of $30,000 were charged to retained earnings and paid during the year; the transfer of net income to retained earnings was the only other entry in the Retained Earnings account. In the statement of cash flows for the year ended December 31, 2018, for Naley Company: 86. The net cash provided (used) by investing activities was a. $52,000. b. $(80,000). c. $(272,000). d. $(72,000).

d. $(72,000).

Putnam, Inc. Comparative Balance Sheets December 31, -----------------------------------------2019----------------------2018 Assets: Current Assets: Cash-------------------------------$ 1,380,000--------------$1,080,000 Accounts Receivable (net)----------3,120,000---------------2,160,000 Inventory ---------------------------3,900,000---------------2,520,000 Prepaid Expenses --------------------702,000 ----------------630,000 -----Total Current Assets-----------=9,102,000--------------=6,390,000 Long-Term Investments---------------450,000 Plant Assets: Property, Plant & Equipment=------4,380,000---------------2,880,000 Accumulated Depreciation--------(900,000)---------------(540,000) ------Total Plant Assets-----------=3,480,000--------------=2,340,000 --Total Assets-------------------=$13,032,000-------------=$8,730,000 Equities: Current Liabilities: Accounts Payable -------------$ 2,550,000----------------$2,190,000 Accrued Expenses-----------------618,000-------------------564,000 Dividends Payable-----------------402,000 --Total Current Liabilities--------=3,570,000------------------=754,000 Long-Term Notes Payable--------1,650,000 Stockholders' Equity: Common Stock------------------6,000,000-----------------4,800,000 Retained Earnings-----------------1,812,000------------------1,176,000 ---Total Equities----------------$13,032,000----------------$8,730,000 Putnam, Inc. Comparative Income Statements December 31, ----------------------------------------2019---------------------2018 Net Credit Sales -------------$14,040,000----------------$7,506,000 Cost of Goods Sold------------7,830,000------------------3,762,000 Gross Profit--------------------=6,210,000-----------------=3,744,000 Operating Expenses (including Income Tax) ---------5,172,000------------------2,748,000 Net Income ------------------=$1,038,000----------------=$ 996,000 Additional Information: a. Accounts receivable and accounts payable relate to merchandise held for sale in the normal course of business. The allowance for bad debts was the same at the end of 2019 and 2018, and no receivables were charged against the allowance. Accounts payable are recorded net of any discount and are always paid within the discount period. b. The proceeds from the note payable were used to finance the acquisition of property, plant, and equipment. Capital stock was sold to provide additional working capital. 96. The amount to be shown on the cash flow statement as net cash provided by investing activities would total what amount? a. $450,000. b. $1,500,000. c. $1,590,000. d. $1,950,000.

d. $1,950,000.

Harlan Mining Co. has recently decided to go public and has hired you as an independent CPA. One statement that the enterprise is anxious to have prepared is a statement of cash flows. Financial statements of Harlan Mining Co. for 2019 and 2018 are provided below. BALANCE SHEETS --------------------------------------------12/31/19------------------ 12/31/18 Cash ------------------------------------$408,000---------------- $ 192,000 Accounts receivable---------------------360,000-------------------216,000 Inventory---------------------------------384,000------------------480,000 Property, plant and equipment---$608,000 --------------$960,000 Less accumulated depreciation--(320,000)=288,000-----(304,000)=656,000 -------------------------------------------$1,440,000------------$1,544,000 Accounts payable------------------------$ 176,000------------------$ 96,000 Income taxes payable---------------------352,000-------------------392,000 Bonds payable-----------------------------360,000------------------600,000 Common stock-----------------------------216,000--------------------216,000 Retained earnings-------------------------336,000-------------------240,000 ------------------------------------------$1,440,000-----------------$1,544,000 INCOME STATEMENT For the Year Ended December 31, 2019 Sales revenue----------------------------$8,400,000 Cost of sales-----------------------------(7,152,000) Gross profit-----------------------------=1,248,000 Selling expenses---------$600,000 Administrative expenses=+192,000------=(792,000) Income from operations-----------------=456,000 Interest expense---------------------------(72,000) Income before taxes---------------------=384,000 Income taxes------------------------------(96,000) Net income------------------------------=$ 288,000 The following additional data were provided: 1. Dividends for the year 2019 were $192,000. 2. During the year, equipment was sold for $240,000. This equipment cost $352,000 originally and had a book value of $288,000 at the time of sale. The loss on sale was incorrectly charged to cost of sales. 3. All depreciation expense is in the selling expense category. 54. Under the direct method, the total taxes paid is a. $96,000. b. $40,000. c. $56,000. d. $136,000.

d. $136,000.

Fleming Company provided the following information on selected transactions during 2018: Dividends paid to preferred stockholders -----------$ 500,000 Loans made to affiliated corporations ----------------1,400,000 Proceeds from issuing bonds -------------------------1,600,000 Proceeds from issuing preferred stock ---------------2,100,000 Proceeds from sale of equipment ---------------------800,000 Purchases of inventories -----------------------------2,400,000 Purchase of land by issuing bonds --------------------600,000 Purchases of treasury stock --------------------------1,200,000 99. The net cash provided (used) by financing activities during 2018 is a. $(3,300,000). b. $1,110,000. c. $2,600,000. d. $2,000,000.

d. $2,000,000.

Selected information from Dinkel Company's 2018 accounting records is as follows: Proceeds from issuance of common stock --------------------$ 800,000 Proceeds from issuance of bonds ------------------------------2,400,000 Cash dividends on common stock paid --------------------------290,000 Cash dividends on preferred stock paid --------------------------120,000 Purchases of treasury stock ---------------------------------------240,000 Sale of stock to officers and employees not included above ---200,000 Dinkel's statement of cash flows for the year ended December 31, 2018, would show net cash provided (used) by financing activities of a. $120,000. b. $(470,000). c. $290,000. d. $2,750,000.

d. $2,750,000.

Financial statements for Kiner Company are given below: Kiner Company Balance Sheet January 1, 2018 Assets------------------------------------------Equities Cash-------------------------$960,000--------Accounts payable--$456,000 Accounts receivable---------864,000 Buildings and equipment---3,600,000 Accumulated depreciation— buildings and equipment--(1,200,000)-------Common stock----2,760,000 Patents------------------------432,000-------Retained earnings--1,440,000 -----------------------------$4,656,000---------------------------$4,656,000 Kiner Company Statement of Cash Flows For the Year Ended December 31, 2018 Increase (Decrease) in Cash Cash flows from operating activities Net income---------------------------------------------------------$1,200,000 Adjustments to reconcile net income to net cash provided by operating activities: ---Increase in accounts receivable----------------$(384,000) ---Increase in accounts payable-----------------------192,000 ---Depreciation—buildings and equipment-----------360,000 ---Gain on sale of equipment------------------------(144,000) ---Amortization of patents-----------------------------48,000--------+72,000 Net cash provided by operating activities--------------------------1,272,000 Cash flows from investing activities ---Sale of equipment----------------------------------288,000 ---Purchase of land----------------------------------(600,000) ---Purchase of buildings and equipment-----------(1,152,000) Net cash used by investing activities----------------------------(1,464,000) Cash flows from financing activities ---Payment of cash dividend------------------------(360,000) ---Sale of common stock------------------------------960,000 Net cash provided by financing activities-------------------------600,000 Net increase in cash-----------------------------------------------=408,000 Cash, January 1, 2018-----------------------------------------------+960,000 Cash, December 31, 2018----------------------------------------=$1,368,000 Total assets on the balance sheet at December 31, 2018 are $6,648,000. Accumulated deprecia-tion on the equipment sold was $336,000. 67. Capital stock (plus any additional paid-in capital) at December 31, 2018 was a. $2,400,000. b. $2,760,000. c. $1,560,000. d. $3,720,000.

d. $3,720,000.

Net cash flow from operating activities for 2018 for Graham Corporation was $495,000. The following items are reported on the financial statements for 2018: Depreciation and amortization----------$ 30,000 Cash dividends paid on common stock---18,000 Increase in accounts receivable-----------36,000 Based only on the information above, Graham's net income for 2018 was: a. $429,000. b. $441,000. c. $489,000. d. $501,000.

d. $501,000.

Jarvis, Inc. reported net income of $59,000 for the year ended December 31, 2018 Included in net income were depreciation expense of $8,400 and a gain on sale of equipment of $1,700. Each of the following accounts increased during 2018: Accounts receivable------------$2,200 Inventory------------------------$4,500 Prepaid rent---------------------$6,800 Available-for-sale securities----$1,000 Accounts payable--------------$5,000 What is the amount of cash provided by operating activities for Jarvis, Inc. for the year ended December 31, 2018? a. $56,200 b. $58,900 c. $47,200 d. $57,200

d. $57,200

Equipment which cost $426,000 and had accumulated depreciation of $228,000 was sold for $222,000. This transaction should be shown on the statement of cash flows (indirect method) as a(n) a. addition to net income of $24,000 and a $222,000 cash inflow from financing activities. b. deduction from net income of $24,000 and a $198,000 cash inflow from investing activities. c. deduction from net income of $24,000 and a $222,000 cash inflow from investing activities. d. addition to net income of $24,000 and a $198,000 cash inflow from financing activities.

d. addition to net income of $24,000 and a $198,000 cash inflow from financing activities.