The comparative balance sheets for Beckwith Products Company are presented below. 2019 2018 Assets: Cash $...

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The comparative balance sheets for Beckwith Products Company are presented below. 2019 2018 Assets: Cash $ 36,950 $ 25,000 Accounts receivable 75,100 78,000 Inventory 45,300 36,000 Property, plant, and equipment 256,400 153,000 Accumulated depreciation 38,650 20,000 Total assets $375,100 $272,000 Liabilities and Equity: Accounts payable $13,100 $11,000 Interest payable 11,500 8,000 Wages payable 8,100 9,000 Notes payable 105,000 90,000 Common stock 100,000 50,000 Retained earnings 137,400 104,000 Total liabilities and equity $375,100 $272,000 Additional Information: 1. Net income for 2019 was $58,400. 2. Cash dividends of $25,000 were declared and paid during 2019. 3. During 2019, Beckwith issued $50,000 of notes payable and repaid $35,000 principal relating to notes payable. 3. During 2019, Beckwith issued $50,000 of notes payable and repaid $35,000 principal relating to notes payable. 4. Common stock was issued for $50,000 cash. 5. Depreciation expense was $18,650, and there were no disposals of equipment. Required: 1. Prepare a statement of cash flows (indirect method) for Beckwith Products for 2019. Use a minus sign to indicate any decreases in cash or cash outflows. Beckwith Products Company Statement of Cash Flows For the Year Ended December 31, 2019 Cash flows from operating activities: Net income ✔ 58,400 ✓ Adjustments to reconcile net income to net cash flow from operating activities: Depreciation expense ✓ 18,650 Decrease in accounts receivable ✔ 2,900 Increase in inventory ✓ -9,300 Increase in accounts payable ✓ 2,100 Increase in interest payable ✓ 3,500 Decrease in wages payable ✔ -900 Net cash provided by operating activities Cash flows from investing activities: Equipment purchase ✓ Net cash used for investing activities 16,950 -103,400 ✓ 75,350 -103,400 Cash flows from financing activities: Cash received from issuance of notes ✓ Repayment of long-term liabilities ✓ Cash received from stock issue ✓ Payment of dividends ✔ Net cash provided by financing activities 40,000 Net increase (decrease) in cash ✔ 11,950 Cash, 1/1/2019 25,000 Cash, 12/31/2019 36,950 Feedback ►Check My Work 2. Compute the following cash-based performance measures: a. Free cash flow b. Cash flow adequacy (Note: Assume that the average amount of debt maturing over the next 5 years is $85,000.) Round ratio to two decimal places. Enter negative values as negative numbers. Free cash flow Adequacy ratio X 50,000 -35,000✔ 50,000 -25,000 The comparative balance sheets for Beckwith Products Company are presented below. 2019 2018 Assets: Cash $ 36,950 $ 25,000 Accounts receivable 75,100 78,000 Inventory 45,300 36,000 Property, plant, and equipment 256,400 153,000 Accumulated depreciation 38,650 20,000 Total assets $375,100 $272,000 Liabilities and Equity: Accounts payable $13,100 $11,000 Interest payable 11,500 8,000 Wages payable 8,100 9,000 Notes payable 105,000 90,000 Common stock 100,000 50,000 Retained earnings 137,400 104,000 Total liabilities and equity $375,100 $272,000 Additional Information: 1. Net income for 2019 was $58,400. 2. Cash dividends of $25,000 were declared and paid during 2019. 3. During 2019, Beckwith issued $50,000 of notes payable and repaid $35,000 principal relating to notes payable. 3. During 2019, Beckwith issued $50,000 of notes payable and repaid $35,000 principal relating to notes payable. 4. Common stock was issued for $50,000 cash. 5. Depreciation expense was $18,650, and there were no disposals of equipment. Required: 1. Prepare a statement of cash flows (indirect method) for Beckwith Products for 2019. Use a minus sign to indicate any decreases in cash or cash outflows. Beckwith Products Company Statement of Cash Flows For the Year Ended December 31, 2019 Cash flows from operating activities: Net income ✔ 58,400 ✓ Adjustments to reconcile net income to net cash flow from operating activities: Depreciation expense ✓ 18,650 Decrease in accounts receivable ✔ 2,900 Increase in inventory ✓ -9,300 Increase in accounts payable ✓ 2,100 Increase in interest payable ✓ 3,500 Decrease in wages payable ✔ -900 Net cash provided by operating activities Cash flows from investing activities: Equipment purchase ✓ Net cash used for investing activities 16,950 -103,400 ✓ 75,350 -103,400 Cash flows from financing activities: Cash received from issuance of notes ✓ Repayment of long-term liabilities ✓ Cash received from stock issue ✓ Payment of dividends ✔ Net cash provided by financing activities 40,000 Net increase (decrease) in cash ✔ 11,950 Cash, 1/1/2019 25,000 Cash, 12/31/2019 36,950 Feedback ►Check My Work 2. Compute the following cash-based performance measures: a. Free cash flow b. Cash flow adequacy (Note: Assume that the average amount of debt maturing over the next 5 years is $85,000.) Round ratio to two decimal places. Enter negative values as negative numbers. Free cash flow Adequacy ratio X 50,000 -35,000✔ 50,000 -25,000

Answer rating: 100% (QA)

Beckwith Products Company Statement of Cash Flows For the Year Ended December 31 2019 19150 2900 9... View the full answer