Question: Kenji International Inc s income statement and comparative balance sheets appear

Kenji International, Inc.’s income statement and comparative balance sheets appear as follows:
Additional information related to business activities during 2014:
1. All accounts payable pertain to inventory purchases, and accrued liabilities pertain to other operating expenses.
2. The original cost of the equipment sold was $38,000. New equipment was purchased by issuing a 6%, $100,000, 5-year long-term note payable as a partial payment.
1. Identify source and use of cash for each account in the Balance Sheet.
2. Calculate the cash receipt from the sale of equipment and the cost of the new equipment, using T-accounts to show your calculations.
3. Prepare a cash flow statement, using the indirect method.
4. Prepare the cash flow from operating activities section by using the direct method.

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  • CreatedJuly 08, 2015
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