The following financial statement data is available for the Winston Salem Company for Dec. 31, 2015. (30
Question:
The following financial statement data is available for the Winston Salem Company for Dec. 31, 2015. (30 pts)
Instruction
? Prepare a statement of cash flows in proper form for 2015 using the Indirect method. Then, redo the Operating Section only using the Direct method.
? In this exercise, make sure to account for all changes in the balance sheet and reconcile those to the appropriate section of the cash flow statement.
? There are no non-cash transactions affecting investing activities.
? The only sales of assets are the ones reflected in the income statement.
? On April 1, 2015, the company paid $14 per share for Treasury Shares.
? On Sept. 1, 2015, the company declared and issued a 5% stock dividend on outstanding shares when the market price of the stock was $17.
? All other transactions affecting Contributed Capital and Retained Earnings occurred after Sept. 1, 2015.
? There were no stock retirements.
? To think through the effect on cash flows, it is helpful to use t-accounts, journal entries, and/or the accounting equation to see how transactions affected cash, especially for the treasury stock transaction and the stock dividends transaction.
Accounting Business Reporting for Decision Making
ISBN: 9780730302414
4th edition
Authors: Jacqueline Birt, Keryn Chalmers, Albie Brooks, Suzanne Byrne, Judy Oliver