Question

During the past 30 years, Only Toys, Inc., has grown from a single-location specialty toy store into a chain of stores selling a wide range of children’s products. Its activities in 20X1 included the following:
1. The organization issued $1,906,000 in long-term debt; $850,000 of the proceeds was used to retire debt that became due in 20X1 and was listed on the books at $850,000.
2. The company purchased 40% of the stock of Bozeman Toy Company for $3,900,000 cash.
3. The firm purchased property, plant, and equipment for $1,986,000 cash, and sold property with a book value of $600,000 for $600,000 cash.
4. The company signed a note payable for the purchase of new equipment; the obligation was listed at $516,000.
5. Executives exercised stock options for 8,000 shares of common stock, paying cash of $170,000.
6. On December 30, 20X1, the firm bought Salzburg Musical Instruments Company by issuing common stock with a market value of $305,000.
7. The company issued common stock for $3,300,000 cash.
8. The firm withdrew $800,000 cash from a money market fund that was considered a cash equivalent.
9. The company bought $249,000 of treasury stock to hold for future exercise of stock options.
10. Long-term debt of $960,000 was converted to common stock.
11. Selected results for the year follow:
Net income .................. $ 809,000
Depreciation and amortization ........... 615,000
Increase in inventory .............. 72,000
Increase in accounts receivable ......... 31,000
Increase in accounts and wages payable ....... 7,000
Increase in taxes payable ............. 35,000
Interest expense ............... 144,000
Increase in accrued interest payable ........ 15,000
Sales .................... 9,850,000
Cash dividends received from investments ..... 152,000
Cash paid to suppliers and employees ....... 8,074,000
Cash dividends paid ............. 240,000
Cash paid for taxes ............... 390,000
Prepare a statement of cash flows for 20X1 using the direct method. Include a schedule that reconciles net income to net cash provided by operating activities. Also include a schedule of noncash investing and financing activities.



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  • CreatedFebruary 20, 2015
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