Prepare a statement of cash flows using the indirect method

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Reference no: EM131639136

Question - Coronado Inc., a greeting card company, had the following statements prepared as of December 31, 2017.

CORONADO INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016


12/31/17

12/31/16

Cash

$6,000

$7,100

Accounts receivable

61,400

51,500

Short-term debt investments (available-for-sale)

34,600

18,000

Inventory

40,300

60,200

Prepaid rent

4,900

4,000

Equipment

152,400

130,600

Accumulated depreciation-equipment

(34,800)

(25,200)

Copyrights

45,700

49,800

Total assets

$310,500

$296,000

 



Accounts payable

$46,100

$40,300

Income taxes payable

4,000

6,000

Salaries and wages payable

7,900

4,000

Short-term loans payable

8,100

10,000

Long-term loans payable

59,700

69,600

Common stock, $10 par

100,000

100,000

Contributed capital, common stock

30,000

30,000

Retained earnings

54,700

36,100

Total liabilities & stockholders' equity

$310,500

$296,000

 

CORONADO INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2017

Sales revenue


$333,450

Cost of goods sold


174,300

Gross profit


159,150

Operating expenses


118,800

Operating income


40,350

Interest expense

$11,600


Gain on sale of equipment

2,000

9,600

Income before tax


30,750

Income tax expense


6,150

Net income


$24,600


Additional information:

1.

Dividends in the amount of $6,000 were declared and paid during 2017.

2.

Depreciation expense and amortization expense are included in operating expenses.

3.

No unrealized gains or losses have occurred on the investments during the year.

4.

Equipment that had a cost of $19,800 and was 70% depreciated was sold during 2017.

Prepare a statement of cash flows using the indirect method.

Reference no: EM131639136

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