Refer to the information presented for Wayfarer Inc. in P17-7B. Additional information: 1. Accounts Payable is used
Question:
Refer to the information presented for Wayfarer Inc. in P17-7B.
Additional information:
1. Accounts Payable is used for merchandise purchases.
2. Accounts receivable relate to merchandise sales.
Instructions
Prepare a cash flow statement for the year using the direct method.
TAKING IT FURTHER
Wayfarer Inc.'s cash balance decreased by $55,800 in 2014. Briefly explain what caused this, using the cash flow statement. Should management be concerned about this decrease?
Transcribed Image Text:
WAYFARER INC Balance Sheet December 31 Assets Cash Accounts receivable Inventory Long-term debt investment Property, plant, and equipment 2014 2013 $176,400 135,000 257,400 120,600 181,800 369,000 176,400 1,008,000 (292,500) 828,000 (252,000) $ 1、144,800 $1,563,300 Liabilities and Shareholders 117,000 Accounts payable Dividends payable Income tax payable Long-term notes payable Common shares Retained earnings s 157,500 10,800 25,200 81,000 1·170,000 118,800 $1,563,300 28,800 945,000 54,000 $1,144,800 WAYFARER INC Income Statement Year Ended December 31, 2014 Sales Cost of goods sold Gross profit $1,137,600 772,200 365,400 $265,500 3,600 Loss on sale of equipment Profit from operations Interest expense Interest revenue Profit before income tax Income tax expense Prosi 269,100 %,300 $ 5,400 (9,900) (4,500) 100,800 25,200 $ 75,600
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WAYFARER INC Cash Flow Statement Direct Method Year Ended December 31 2014 Operating activities Cash receipts From customers 1090800 1 From interest 9000 2 1099800 Cash payments To suppliers 843300 3 ...View the full answer
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Related Book For
Accounting Principles Part 3
ISBN: 978-1118306802
6th Canadian edition Volume 1
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Barbara Trenholm, Valerie Kinnear, Joan E. Barlow
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