Question

A comparative balance sheet for the Kris Kringle Corporation is presented below: KRIS KRINGLE CORPORATION Comparative...

A comparative balance sheet for the Kris Kringle Corporation is presented below:

KRIS KRINGLE CORPORATION

Comparative Balance Sheet

    2018

    2017

Assets

Cash

$ 37,000

$ 31,000

Accounts receivable (net)

80,000

60,000

Prepaid insurance

22,000

17,000

Land

18,000

40,000

Equipment

70,000

60,000

Accumulated depreciation

   (20,000)

   (13,000)

Total Assets

$207,000

$195,000

Liabilities and Stockholders' Equity

Accounts payable

$ 12,000

$   6,000

Bonds payable

27,000

19,000

Common stock

140,000

115,000

Retained earnings

    28,000

    55,000

Total liabilities and stockholders' equity

$207,000

$195,000

Additional information:

1.     Net loss for 2018 is $12,000. Depreciation expense for 2018 is $ 17,000.

2.     Cash dividends of $15,000 were declared and paid in 2018.

3.     Land was sold for $ 20,000 cash, resulting in a loss of $2,000. This was the only land transaction during the year.

4.     Equipment with a cost of $15,000 and accumulated depreciation of $10,000 was sold for $5,000 cash.

5.     $12,000 of bonds were retired during the year at carrying (book) value.

6.     Equipment was acquired for common stock. The fair value of the stock at the time of the exchange was $25,000.

Instructions

Prepare a statement of cash flows for the year ended 2018 using the indirect method using the format below.

Cash flows from _____________________ activities:

Net cash used/provided by _____________________ activities__________________________

_________________________________________________________________________

_________________________________________________________________________

Cash Flows from _______________________ activities:

Net cash used/provided by _____________________ activities__________________________

_________________________________________________________________________

​_________________________________________________________________________

Cash flows from __________________________ activities:

Net cash used/provided by _____________________ activities__________________________

_________________________________________________________________________

​_________________________________________________________________________

Noncash investing and financing activities: __________________________________________________________________________

Business   Accounting   
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Homework Answers

Answer #1

Statement of cash flow

Cash flow from operating activities
Net (loss) -12000
Adjustment to reconcile net income to net cash flow from operating activities
Depreciation expense 17000
Loss on sale of land 2000
Increase account receivable -20000
Increase prepaid insurance -5000
Increase account payable 6000
0
Net cash used in operating activities -12000
Cash flow from investing activities
Sale of land 20000
Equipment sold 5000
Net cash flow from investing activities 25000
Cash flow from financing activities
Dividend paid -15000
Bond retired -12000
Issue bonds payable 20000
Net cash used in financing activities -7000
Net cash increase (decrease) 6000
Beginning Cash 31000
Ending Cash 37000
Non Cash investing and financing activities
Issue common Stock for equipment purchase 25000
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