Pharoah Corp. uses the direct method to prepare its statement of cash flows. Pharoah trial balances at
Question:
Pharoah Corp. uses the direct method to prepare its statement of cash flows. Pharoah trial balances at December 31, 2017, and 2016, are as follows.
December-31 | ||
Debits | 2017 | 2016 |
Cash | $35,400 | $31,700 |
Accounts receivable | 32,600 | 29,900 |
Inventory | 31,300 | 47,300 |
Property, plant & equipment | 99,900 | 95,000 |
Unamortized bond discount | 4,500 | 5,000 |
Cost of goods sold | 252,200 | 377,300 |
Selling expenses | 140,600 | 170,400 |
General and administrative expenses | 135,900 | 150,800 |
Interest expense | 4,300 | 2,600 |
Income tax expense | 20,400 | 60,600 |
$757,100 | $970,600 | |
Credits | ||
Allowance for doubtful accounts | $1,300 | $1,000 |
Accumulated depreciation-plant assets | 16,500 | 15,000 |
Accounts payable | 25,300 | 15,700 |
Income taxes payable | 21,100 | 29,300 |
Deferred tax liability | 5,300 | 4,600 |
8% callable bonds payable | 45,200 | 20,000 |
Common stock | 50,200 | 40,030 |
Paid-in capital in excess of par | 9,000 | 7,500 |
Retained earnings | 44,500 | 64,100 |
Sales revenue | 538,700 | 773,400 |
$757,100 | $970,600 |
Additional information:
1. Pharoah purchased $4,900 in equipment during 2017.
2. Pharoah allocated one-third of its depreciation expense to selling expenses and the remainder to general and administrative expenses.
3. Bad debt expense for 2017 was $5,000, and write-offs of uncollectible accounts totaled $4,700.
Determine what amounts Pharoah should report in its statement of cash flows for the year ended December 31, 2017, for the following items:
a) Cash collected from customers.
b) Cash paid to suppliers.
c) Cash paid for interest.
d) Cash paid for income taxes.
Intermediate Accounting
ISBN: 978-0470423684
13th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, And Terry D. Warfield