Sarasota Inc., a major retailer of bicycles and accessories, operates several stores and is a publicly...
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Sarasota Inc., a major retailer of bicycles and accessories, operates several stores and is a publicly traded company. The company is currently preparing its statement of cash flows and follows the policy of classifying interest paid as operating cash flows and dividends paid as financing cash flows. The comparative statement of financial position and income statement for Sarasota as of May 31, 2020, are as follows: SARASOTA INC. Statement of Financial Position As at May 31 Current assets 2020 2019 Cash $35,180 $20,860 Accounts receivable 78,580 56,380 Inventory 189,290 199,820 Prepaid expenses 8,480 7,610 Total current assets 311,530 284,670 Plant assets 597,500 503,500 Less: Accumulated depreciation 151,860 122,860 Net plant assets 445,640 380,640 Total assets $757,170 $665,310 Current liabilities Accounts payable $122,780 $115,780 Salaries and wages payable 61,380 72,610 Interest payable 26,230 23,420 Total current liabilities 210,390 211,810 Mortgage payable 76,760 102,000 Total liabilities 287,150 313,810 Shareholders' equity Common shares 335,990 280,000 Retained earnings 134,030 71,500 Total shareholders' equity 470,020 351,500 Total liabilities and shareholders' equity $757,170 $665,310 SARASOTA INC. Income Statement For the Year Ended May 31, 2020 Sales $ 1,336,160 Cost of goods sold 807,000 Gross margin 529,160 Expenses Salaries and wages expense 203,000 Interest expense 65,200 Other operating expenses 24,800 Depreciation expense 29,000 Total operating expenses 322,000 Operating income 207.160 Income tax expense 65,700 Net earnings 141.460 The following is additional information about transactions during the year ended May 31, 2020, for Sarasota Inc., which follows IFRS. 1. Plant assets costing $94,000 were purchased by paying $51,000 in cash and issuing 5,000 common shares. 2. The "other expenses" relate to prepaid items. 3. In order to supplement its cash, Sarasota issued 4,000 additional common shares. 4. There were no penalties assessed for the repayment of the mortgage. 5. Cash dividends of $78,930 were declared and paid at the end of the fiscal year. Using the indirect method, calculate only the net cash flow from operating activities for Sarasota Inc. for the year ended May 31, 2020. (Show amounts that decrease cash flow with either a- sign e.g. -15,000 or in parenthesis eg. (15,000).) Net cash provided bv operating activities $ Sarasota Inc., a major retailer of bicycles and accessories, operates several stores and is a publicly traded company. The company is currently preparing its statement of cash flows and follows the policy of classifying interest paid as operating cash flows and dividends paid as financing cash flows. The comparative statement of financial position and income statement for Sarasota as of May 31, 2020, are as follows: SARASOTA INC. Statement of Financial Position As at May 31 Current assets 2020 2019 Cash $35,180 $20,860 Accounts receivable 78,580 56,380 Inventory 189,290 199,820 Prepaid expenses 8,480 7,610 Total current assets 311,530 284,670 Plant assets 597,500 503,500 Less: Accumulated depreciation 151,860 122,860 Net plant assets 445,640 380,640 Total assets $757,170 $665,310 Current liabilities Accounts payable $122,780 $115,780 Salaries and wages payable 61,380 72,610 Interest payable 26,230 23,420 Total current liabilities 210,390 211,810 Mortgage payable 76,760 102,000 Total liabilities 287,150 313,810 Shareholders' equity Common shares 335,990 280,000 Retained earnings 134,030 71,500 Total shareholders' equity 470,020 351,500 Total liabilities and shareholders' equity $757,170 $665,310 SARASOTA INC. Income Statement For the Year Ended May 31, 2020 Sales $ 1,336,160 Cost of goods sold 807,000 Gross margin 529,160 Expenses Salaries and wages expense 203,000 Interest expense 65,200 Other operating expenses 24,800 Depreciation expense 29,000 Total operating expenses 322,000 Operating income 207.160 Income tax expense 65,700 Net earnings 141.460 The following is additional information about transactions during the year ended May 31, 2020, for Sarasota Inc., which follows IFRS. 1. Plant assets costing $94,000 were purchased by paying $51,000 in cash and issuing 5,000 common shares. 2. The "other expenses" relate to prepaid items. 3. In order to supplement its cash, Sarasota issued 4,000 additional common shares. 4. There were no penalties assessed for the repayment of the mortgage. 5. Cash dividends of $78,930 were declared and paid at the end of the fiscal year. Using the indirect method, calculate only the net cash flow from operating activities for Sarasota Inc. for the year ended May 31, 2020. (Show amounts that decrease cash flow with either a- sign e.g. -15,000 or in parenthesis eg. (15,000).) Net cash provided bv operating activities $
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CALCULATION OF NET CASH FLOW FROM OPERATING ACTIVITIES FOR SARASOTA INC FOR THE YEAR ENDED ... View the full answer
Related Book For
Intermediate Accounting IFRS
ISBN: 9781119607519
4th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
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