Question

Accurate Digital Services, Inc., has provided the following data from the company’s ­records for the year just ended December 31:
a. Collection of interest...................................................................................... $ 5,600
b. Cash sales....................................................................................................... $ 254,000
c. Credit sales..................................................................................................... $ 673,500
d. Proceeds from sale of investment.................................................................. $ 12,300
e. Gain on sale of investment............................................................................. $ 2,800
f. Payments to suppliers.................................................................................... $ 573,000
g. Cash payments to purchase plant assets....................................................... $ 52,300
h. Depreciation expense.................................................................................... $ 63,400
i. Salaries expense............................................................................................. $ 77,100
j. Payment of short- term note payable by issuing common stock.................... $ 72,100
k. Cost of goods sold......................................................................................... $ 568,500
l. Proceeds from issuance of note payable....................................................... $ 24,100
m. Income tax expense and payment................................................................. $ 38,400
n. Proceeds from issuance of common stock..................................................... $ 23,500
o. Cash receipt of dividend revenue.................................................................. $ 6,600
p. Interest revenue.............................................................................................. $ 6,200
q. Payment of cash dividends............................................................................. $ 28,900
r. Collections of accounts receivable................................................................. $ 573,000
s. Amortization expense.................................................................................... $ 3,700
t. Payments on long- term notes payable.......................................................... $ 45,000
u. Interest expense and payments..................................................................... $ 12,200
v. Purchase of equipment by issuing common stock to seller........................... $ 17,300
w. Payment of salaries......................................................................................... $ 74,300
x. Proceeds from sale of plant assets................................................................. $ 24,300
y. Loss on sale of plant assets............................................................................ $ 3,700
z. Cash and cash equivalents balance, beginning of year................................. $ 25,400

Requirements
1. Prepare the statement of cash flows for Accurate Digital Services, Inc., using the ­direct method for cash flows from operations. Note that you will need to calculate the ending balance of cash and cash equivalents. Include a schedule of noncash investing and financing activities.
2. Evaluate the company’s cash flows for the year. Discuss each of the categories of cash flows in your response.



$1.99
Sales2
Views125
Comments0
  • CreatedAugust 27, 2014
  • Files Included
Post your question
5000