Question

Davis Corporation had the following transactions in their first year of opeations: Sales(90% collected in year)...

Davis Corporation had the following transactions in their first year of opeations:

Sales(90% collected in year) $1,500,00
Bad debt write-offs $60,000
Disbursements for costs and expenses $1,200,000
Disbursements for income taxes 90,000
Purchases of fixed assets 400,000
Depreciation of fixed assets 80,000
Proceeds from issuance of common stock 500,000
Proceeds from short-term borrowings 100,000
Payments on short-term borrowings 50,000

What is the cash at year end ?

Homework Answers

Answer #1
Beginning balance 0
current period transactions
Collection of sales (1500000*90%0 1350000
Bad debt (non cash) 0
Disbursements for costs and expenses -1200000
Disbursements for income taxes -90000
Purchases of fixed assets -400000
Depreciation of fixed assets (non cash) 0
Proceeds from issuance of common stock 500000
Proceeds from short-term borrowings 100000
Payments on short-term borrowings -50000
210000
Cash at end (beginning +current period) 210000
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