Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
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Chapter 13, Problem 13.37BP
Prepare statement of cash flows (indirect method) (Learning Objectives 1 & 2)
The 2017 and 2016 balance sheets of Gibson Corporation follow. The 2017 income statement is also provided. Gibson had no noncash investing and financing transactions during 2017. During the year, the company sold equipment for $15,200, which had originally cost $12,800 and had a book value of $11,300. The company did not issue any notes payable during the year but did issue common stock for $31,000. The company purchased plant assets and long-term investments with cash.
13.5-45 Full Alternative Text
13.5-46 Full Alternative Text
Requirements
- 1. Prepare the statement of cash flows for Gibson Corporation for 2017 using the indirect method.
- 2. Evaluate the company’s cash flows for the year. Discuss each of the categories of cash flows in your response.
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Students have asked these similar questions
Calculate free cash flow for 2017 for Monarch Textiles, Inc., based on the financial information that follows. Assume that
all current liabilities are non-interest-bearing liabilities and that no fixed assets were sold or disposed of during 2017.
(Round your answer to 1 decimal places.)
Sales
Cost of sales
Income statement
Operating expenses
Depreciation
Interest expense
Earnings before taxes
Tax
Net income
Free cash flow
Monarch Textiles, Inc. ($ thousands)
2017
1,280
760
130
62
50
278.00
111.20
166.80
X Answer is complete but not entirely correct.
$ 140.9
Selected balance sheet items
Current assets
Net fixed assets
Current liabilities
2016
360
124
230
2017
490
248
310
The Garfield Ltd company uses the indirect method for preparing its statement of cash flows. It reported a net income of $100,000 for the year 2016.During the year 2016, the working capital accounts were changed as follows:Increase in accounts receivable: $22,000Increase in accounts payable: $18,600Increase in inventory: $14,800Decrease in non-trade notes payable: $30,000Increase in available for sale securities: $32,000The depreciation expense was $34,000 for the year 2016.
Calculate free cash flow for 2017 for Monarch Textiles, Inc., based on the financial information that follows. Assume that all current
liabilities and that no fixed assets were sold or disposed of during 2017. (Round your answer to 1
liabilities are non-interest-bearing
decimal places.)
Sales
Cost of sales
Operating expenses
Depreciation
Income statement
Interest expense
Earnings before taxes
Tax
Net income
Free cash flow
Monarch Textiles, Inc. ($ thousands)
2017
1,250
750
125
60
50
265.00
106.00
159.00
Selected balance sheet items
Current assets
Net fixed assets
Current liabilities
2016
350
120
225
2017
475
240
305
Chapter 13 Solutions
Managerial Accounting (5th Edition)
Ch. 13 - (Learning Objective 1) Which of the following is...Ch. 13 - Prob. 2QCCh. 13 - Prob. 3QCCh. 13 - Prob. 4QCCh. 13 - Prob. 5QCCh. 13 - Prob. 6QCCh. 13 - Prob. 7QCCh. 13 - Prob. 8QCCh. 13 - Prob. 9QCCh. 13 - (Learning Objective 3) Which one of the following...
Ch. 13 - Prob. 13.1SECh. 13 - Prob. 13.2SECh. 13 - Prob. 13.3SECh. 13 - Prob. 13.4SECh. 13 - Prob. 13.5SECh. 13 - Calculate financing cash flows (Learning...Ch. 13 - Prob. 13.7SECh. 13 - Prob. 13.8SECh. 13 - Prob. 13.9SECh. 13 - Prob. 13.10SECh. 13 - Prob. 13.11SECh. 13 - Prob. 13.12AECh. 13 - Prob. 13.13AECh. 13 - Prob. 13.14AECh. 13 - Calculate operating cash flows (indirect method)...Ch. 13 - Prob. 13.16AECh. 13 - Prob. 13.17AECh. 13 - Prob. 13.18AECh. 13 - Prob. 13.19AECh. 13 - Prob. 13.20AECh. 13 - Classify sustainable activities effect on cash...Ch. 13 - Prob. 13.22BECh. 13 - Prob. 13.23BECh. 13 - Prob. 13.24BECh. 13 - Calculate operating cash flows (indirect method)...Ch. 13 - Prob. 13.26BECh. 13 - Prob. 13.27BECh. 13 - Prob. 13.28BECh. 13 - Prob. 13.29BECh. 13 - Prob. 13.30BECh. 13 - Classify sustainable activities effect on cash...Ch. 13 - Prob. 13.32APCh. 13 - Prepare statement of cash flows (indirect method)...Ch. 13 - Prob. 13.34APCh. 13 - Prob. 13.35APCh. 13 - Prob. 13.36BPCh. 13 - Prepare statement of cash flows (indirect method)...Ch. 13 - Prob. 13.38BPCh. 13 - Prob. 13.39BPCh. 13 - Prob. 13.40SCCh. 13 - Discussion Analysis A13-41 Discussion Questions...Ch. 13 - Prob. 13.42ACTCh. 13 - Ethics involved with statement of cash flows...Ch. 13 - Prob. 13.44ACTCh. 13 - Prob. 13.45ACT
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