The comparative statement of financial position of Ava Co. for the year ended December 31, 2015...

 

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The comparative statement of financial position of Ava Co. for the year ended December 31, 2015 and 2014 is presented below. The income statement for the year 2015 is also provided. Additional information: In March 2015, a plot of land was sold. There was no purchase of land during 2015. In April 2015, a new note payable was issued to collect cash for a new project. No payment has been made for note payable in 2015. On December 31, 2015, new machinery was purchased for $120,000 cash. Also old machinery was sold for cash. In 2015, dividend was declared and paid to shareholders. During 2015, Ava Co. issued common shares to raise money to extend its business. Asset Ava Corporation Statement of Financial Position At December 31, 2015 and 2014 (All amounts are in Canadian Dollars) 2015 2014 Current assets Cash Accounts receivable 17,000 40,000 312,000 125,000 Inventory Prepaid rent 36,000 25,000 0 7,000 Total Current Assets 365,000 197,000 Non current assets Land 29,000 38,000 Machinery 690,000 600,000 Accumulated depreciation-machinery (224,000) (215,000) Book value-equipment 466,000 385,000 Total non-current assets 495,000 423,000 Total assets 860,000 620,000 Liabilities Current liabilities Accounts payable 63,000 32,000 Rent payable 4,000 0 Total current liabilities 67,000 32,000 Notes payable-long term 120,000 45,000 Total Liabilities 187,000 77,000 Common shares 195,000 75,000 Retained earnings 478,000 468,000 Total shareholders' equity 673,000 543,000 Total liabilities and shareholders' 860,000 620,000 For the Ava Corporation Income Statement year ended December 31, 2015 Sales revenue 340,000 Cost of goods sold (180,000) Gross profit 160,000 Operating expenses: Depreciation expense 32,000 Rent expense 16,000 Salary expense 50,000 Advertising expense 49,000 Total operating expenses (147,000) Operating profit 13,000 Other revenues and expenses Gain on sale of land 2,000 Loss on sale of equipment (4,000) Total other revenues and expenses (2,000) Net income 11,000 -6- Required: Prepare a statement of cash flows for the year ended December 31, 2015 for Ava Co. Use the indirect method to report cash flows from operating activities. The comparative statement of financial position of Ava Co. for the year ended December 31, 2015 and 2014 is presented below. The income statement for the year 2015 is also provided. Additional information: In March 2015, a plot of land was sold. There was no purchase of land during 2015. In April 2015, a new note payable was issued to collect cash for a new project. No payment has been made for note payable in 2015. On December 31, 2015, new machinery was purchased for $120,000 cash. Also old machinery was sold for cash. In 2015, dividend was declared and paid to shareholders. During 2015, Ava Co. issued common shares to raise money to extend its business. Asset Ava Corporation Statement of Financial Position At December 31, 2015 and 2014 (All amounts are in Canadian Dollars) 2015 2014 Current assets Cash Accounts receivable 17,000 40,000 312,000 125,000 Inventory Prepaid rent 36,000 25,000 0 7,000 Total Current Assets 365,000 197,000 Non current assets Land 29,000 38,000 Machinery 690,000 600,000 Accumulated depreciation-machinery (224,000) (215,000) Book value-equipment 466,000 385,000 Total non-current assets 495,000 423,000 Total assets 860,000 620,000 Liabilities Current liabilities Accounts payable 63,000 32,000 Rent payable 4,000 0 Total current liabilities 67,000 32,000 Notes payable-long term 120,000 45,000 Total Liabilities 187,000 77,000 Common shares 195,000 75,000 Retained earnings 478,000 468,000 Total shareholders' equity 673,000 543,000 Total liabilities and shareholders' 860,000 620,000 For the Ava Corporation Income Statement year ended December 31, 2015 Sales revenue 340,000 Cost of goods sold (180,000) Gross profit 160,000 Operating expenses: Depreciation expense 32,000 Rent expense 16,000 Salary expense 50,000 Advertising expense 49,000 Total operating expenses (147,000) Operating profit 13,000 Other revenues and expenses Gain on sale of land 2,000 Loss on sale of equipment (4,000) Total other revenues and expenses (2,000) Net income 11,000 -6- Required: Prepare a statement of cash flows for the year ended December 31, 2015 for Ava Co. Use the indirect method to report cash flows from operating activities.