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2)

1 AND 2 ARE SEPARATE QUESTIONS, PLEASE ANSWER SEPERATELY.

Lansing Company's current-year income statement and selected balance sheet data at December 31 of the current and prior years follow. LANSING COMPANY Income Statement For Current Year Ended December 31 Sales revenue $133,200 Expenses Cost of goods sold 54,000 Depreciation expense 18,000 Salaries expense 30,000 Rent expense 10,200 Insurance expense 5,000 Interest expense 4,800 Utilities expense 4,000 Net income $ 7,200 LANSING COMPANY Selected Balance Sheet Accounts At December 31 Current Year Accounts receivable $6,800 Inventory 3,180 Accounts payable 5,600 Salaries payable 1,120 Utilities payable 460 Prepaid insurance 380 Prepaid rent 460 Prior Year $8,200 2,140 7,000 820 280 520 300 Required: Prepare the operating activities section of the statement of cash flows using the indirect method for the current year. (Amounts to be deducted should be indicated with a minus sign.) LANSING COMPANY Cash Flows from Operating ActivitiesIndirect Method For Current Year Ended December 31 Cash flows from operating activities: Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current assets and current liabilities 0 $ 0 Required information [The following information applies to the questions displayed below.) Golden Corp.'s current year income statement, comparative balance sheets, and additional information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. GOLDEN CORPORATION Comparative Balance Sheets December 31 Current Year Prior Year $ 179,000 105,500 623,500 908,000 375,400 (165,500) $1,117,900 $ 123,500 86,000 541,000 750,500 314,000 (111,500) $ 953,000 Assets Cash Accounts receivable Inventory Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Income taxes payable Total current liabilities Equity Common stock, $2 par value Paid-in capital in excess of par value, common stock Retained earnings Total liabilities and equity $ 117,000 43,000 160,000 $ 86,000 32,600 118,600 610,000 223,000 124,900 $1,117,900 583,000 182,500 68,900 $ 953,000 GOLDEN CORPORATION Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income $1,867,000 1,101,000 766,000 509,000 54,000 203,000 43,000 $ 160,000 Additional Information on Current Year Transactions a. Purchased equipment for $61,400 cash. b. Issued 13,500 shares of common stock for $5 cash per share. c. Declared and paid $104,000 in cash dividends. GOLDEN CORPORATION Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current assets and current liabilities $ 0 Cash flows from investing activities 0 Cash flows from financing activities: 0 Cash flows from financing activities: 0 $ 0 Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year $ O