Question

Coronado Industries reported the following information for 2022.

Coronado Industries Comparative Balance Sheets December 31
Assets		2022			2021			Change Increase/Decrease
Cash		$82,600			$50,400			$32,200	Increase
Accounts receivable		86,800			30,800			56,000	Increase
Inventory		61,600			–0–			61,600	Increase
Prepaid expenses		8,400			5,600			2,800	Increase
Land		77,000			98,000			21,000	Decrease
Buildings		280,000			280,000			–0–
Accumulated depreciation—buildings		(29,400	)		(19,600	)		9,800	Increase
Equipment		256,200			95,200			161,000	Increase
Accumulated depreciation—equipment		(39,200	)		(14,000	)		25,200	Increase
Totals		$784,000			$526,400
Liabilities and Stockholders’ Equity
Accounts payable		$60,200			$56,000			$4,200	Increase
Accrued expenses payable		0			14,000			14,000	Decrease
Bonds payable		140,000			210,000			70,000	Decrease
Common stock ($1 par)		322,000			84,000			238,000	Increase
Retained earnings		261,800			162,400			99,400	Increase
Totals		$784,000			$526,400			Coronado Industries Income Statement For the Year Ended December 31, 2022 Sales revenue $1,317,400 Cost of goods sold $665,000 Operating expenses 323,400 Interest expense 16,800 Loss on disposal of equipment 2,800 1,008,000 Income before income taxes 309,400 Income tax expense 91,000 Net income $218,400 Additional information: 1. Operating expenses include depreciation expense of $56,000. 2. Land was sold at its book value for cash. 3. Cash dividends of $119,000 were declared and paid in 2022. 4. Equipment with a cost of $232,400 was purchased for cash. Equipment with a cost of $71,400 and a book value of $50,400 was sold for $47,600 cash. 5. Bonds of $70,000 were redeemed at their face value for cash. 6. Common stock ($1 par) of $238,000 was issued for cash. Use this information to prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Answer 1

$ 218,400 Coronado Industries Statement of Cash flows (Indirect Method) For the Year Ended December 31, 2022 Cash flows from Operating Activities: Net Income Adjustments to reconcile Net Income to Net Cash flows from Operating activities Changes in Current Operating assets and liabilities Depreciation expenses Loss on disposal of equipment Increase in Accounts Receivables Increases in Inventory Increase in Prepaid expense Increase in accounts Payable Decrease in accured expenses payable Net Cash flow from operating activities Cash Flows from Investing Activities Sale of land Sale of equipemnt Purchase of equipment Net Cash flow from investing activities $ $ S $ S $ S 56,000 2.800 (56.000) (61,600) (2.800) 4,200 (14,000) S $ (71,400) 147,000 $ 21,000 $ 47,600 $ (232.400) $ (163.800)

S (119,000) S (70,000) $ 238.000 Cash Flows from Financing Activities Cash Dividends paid Repayment of Bonds payable Issuance of Common stock Net Cash flow from financing activities Net Increase in Cash Cash at the beginning of the period Cash at the end of the period $ S S $ 49,000 32.200 50.400 82.600