Refer to the information reported about Wilson Corporation in Problem 12-1B. Required Prepare a complete statement of

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Refer to the information reported about Wilson Corporation in Problem 12-1B.

Required

Prepare a complete statement of cash flows using a spreadsheet as in Exhibit 12A.1; report its operating activities using the indirect method. Identify the debits and credits in the Analysis of Changes columns with letters that correspond to the following list of transactions and events.

a. Net income was $116,125.

b. Accounts receivable increased.

c. Merchandise inventory increased.

d. Prepaid expenses decreased.

e. Accounts payable decreased.

f. Depreciation expense was $20,000.

g. Sold equipment costing $46,500, with accumulated depreciation of $29,375, for $11,500 cash. This yielded a loss of $5,625.

h. Purchased equipment costing $97,500 by paying $25,000 cash and (i.) by signing a long-term note payable for the balance.

j. Borrowed $2,000 cash by signing a short-term note payable.

k. Paid $50,750 cash to reduce the long-term notes payable.

l. Issued 2,350 shares of common stock for $20 cash per share.

m. Declared and paid cash dividends of $59,000.


Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive...
Accounts Receivable
Accounts receivables are debts owed to your company, usually from sales on credit. Accounts receivable is business asset, the sum of the money owed to you by customers who haven’t paid.The standard procedure in business-to-business sales is that...
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
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Managerial Accounting

ISBN: 978-0073379586

2010 Edition

Authors: John J. Wild, Ken W. Shaw

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