You have been hired by Seeser Flappits Business to prepare its 20X2 cash flow statement. The business
Question:
You have been hired by Seeser Flappits Business to prepare its 20X2 cash flow statement. The business provides you with its 20X2 income statement.
You determine that these numbers are correct. You review the business' 20X2 beginning and ending balance sheets and find that the cash balance was \(\$ 1900\) on 1 January \(20 X 2\), and \(\$ 5100\) on 31 December 20X2. You also find the following changes:
As well you determine that during \(20 \mathrm{X} 2\) the business sold equipment for \(\$ 4800\), purchased land for \(\$ 13000\), and issued a note payable for \(\$ 7500\), all for cash. The owner also withdrew \(\$ 9600\). After all these changes, the business had average total assets of \(\$ 74000\) for \(20 \mathrm{X} 2\). Required:
a Using your findings, prepare the business' \(20 \mathrm{X} 2\) cash flow statement (use the direct method for operating cash flows).
b Calculate the business' \(20 \mathrm{X} 2\) cash return on total assets.
Step by Step Answer:
Accounting Information For Business Decisions
ISBN: 9780170253703
2nd Edition
Authors: Billie Cunningham, Loren A. Nikolai, John Bazley, Marie Kavanagh, Geoff Slaughter, Sharelle Simmons