Prepare a Statement of Cash Flows. Cite all references used and detail formulas and or calculations. Review the income statement for the Country Vista Company.
You will use the income statement to help you complete Part 1 and Part 2 below.
Part 1: Indirect Method Using Excel, prepare the Statement of Cash Flows Indirect Method.
Your SOCF should be based upon the income statement and the additional information below:
Additional Information:
Increase in Accounts Receivables=$4,000
Increase in Accounts Payables=$16,000
Increase in Income Taxes Payable=$300
Decrease in Prepaid Expenses=$10,000
Decrease in Merchandise Inventory=$14,000
Decrease in Long Term Notes Payable=$20,000
Cash Paid to Purchase Land=$50,000
Cash Paid to Purchase Equipment=$15,000
Cash Paid to Retire Bonds=$25,000
Cash Paid to for Dividends=$10,000
Cash Received from the Sale of common stock=$50,000
Cash at the start of the year=$
Part 2: Direct Method Using Excel and the below information please prepare the complete statement of cash flows using the direct method.
Additional Information:
Cash Received from Customers=$80,000
Cash Payments for Merchandise=$10,000
Cash Payments for Operating Expenses=$5,000
Cash payments for Interest=$6,000
Cash Payments for Income Taxes=$3,000
| Country Vista Company |
| Income Statement |
| For the Year Ended December 31, 2011 |
| |
|
|
| Sales |
|
$248,000 |
| Cost of Goods Sold |
|
$116,000 |
| Gross Profit |
|
$132,000 |
| Operating Expenses |
|
|
| Wages and Salaries Expense |
$44,000 |
|
| Rent Expense |
$16,000 |
|
| Depreciation Expense |
$30,000 |
|
| Other Operating Expenses |
$18,000 |
$108,000 |
| Income from Operations |
|
$24,000 |
| Gain on Sale of Equipment |
|
$26,000 |
| Income before Income Taxes |
|
$50,000 |
| Income Tax Expense |
|
$17,500 |
| Net Income |
|
$32,500 |