Shepherd Industries had the following cash flows by major categories during the current year: Cash provided by:
Question:
Shepherd Industries had the following cash flows by major categories during the current year:
Cash provided by:
Receipts from customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $560,000
Sale of bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 400,000
Sale of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,000
Interest and dividends received . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56,000
Sale of equipment (at a $56,000 loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 236,000
Cash used for:
Payments to employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $135,000
Payments to purchase inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190,000
Dividends on common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,000
Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78,000
a. Calculate the net amount of cash provided by or used for financing activities for the year.
b. Briefly justify why you excluded any of the above items in your calculation in part a.
c. Briefly explain your treatment of interest expense in your calculation in part a.
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Step by Step Answer:
Financial and Managerial Accounting the basis for business decisions
ISBN: 978-0078111044
16th edition
Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello