Fleet Limousine Service Inc. began operations in late March 2019. At the end of 2019, the following balance sheet was prepared for Fleet.

Fleet Limousine Service Inc.

Balance Sheets

December 31, 2019

Additional Information:
1. During 2019, land was purchased for $11,000, a building was purchased for $175,000, and equipment was purchased for $233,400.
2. Depreciation expense for 2019 was $35,500.
3. The long-term note was issued for $100,000, and a principal payment of $5,000 was made during 2019.
4. Common stock was issued for $300,000 cash during 2019.
5. During 2019, there was a net loss of $17,200, and no dividends were paid.
Required:
1. Using a spreadsheet, prepare a statement of cash flows for 2019. Assume Fleet Limousine uses the indirect method.
2. Discuss whether Fleet Limousine appears to have matched the timing of inflows and outflows of cash?

Transcribed Image Text:

ASSETS Current assets: Cash Accounts receivable Supplies Total current assets $ 7,200 15,900 3,100 $ 26,200 15,000 Long-term investments Property, plant, and equipment: $ 11,000 Land Building Equipment 175,000 233,400 $419,400 (35,500) Accumulated depreciation Net property, plant, and equipment Total assets 383,900 $425,100 LIABILITIES AND EQUITY Current liabilities: $ 12,700 21,800 4,600 8,200 Accounts payable Uneamed service revenue Salaries payable Rent payable Total current liabilities Long-term liabilities: Notes payable Total liabilities $ 47,300 95,000 $142,300 Equity: Common stock Retained earnings Total equity Total liabilities and equity $300,000 (17,200) 282,800 $425,100