Question

he balance sheet data of Culver Company at the end of 2020 and 2019 are shown below.

		2020			2019
Cash		$30,100			$35,100
Accounts receivable (net)		55,000			44,900
Inventory		64,600			45,100
Prepaid expenses		15,000			24,700
Equipment		90,200			74,500
Accumulated depreciation—equipment		(18,040	)		(8,000	)
Land		70,200			39,800
		$307,060			$256,100
Accounts payable		$64,600			$52,500
Accrued expenses		14,800			17,900
Notes payable—bank, long-term		–0–			22,900
Bonds payable		30,300			–0–
Common stock, $10 par		190,400			160,000
Retained earnings		6,960			2,800
		$307,060			$256,100

Land was acquired for $30,400 in exchange for common stock, par $30,400, during the year; all equipment purchased was for cash. Equipment costing $13,200 was sold for $3,100; book value of the equipment was $6,100. Cash dividends of $10,100 were declared and paid during the year.

Compute net cash provided (used) by: (Show amounts that decrease cash flow with either a - sign e.g. -12,000 or in parenthesis e.g. (12,000).)

(a)		Net Cash by operating activities.		$
(b)		Net Cash by investing activities.		$
(c)		Net Cash by financing activities.		$

Answer 1

a.)	Particulars	Amount in $
	Cash flows from operating activities
	Net Income (6,960 + 10,100 - 2,800 )	14,260
	Adjustments to arrive cash flow from operating activities:
	Depreciation expense { 18,040 - ( 8,000 - 7,100* ) }	17,140
	Loss on sale of Equipment (6,100 - 3,100 )	3,000
	Increase in accounts receivables ( 44,900 - 55,000 )	-10,100
	Increase in Inventory ( 45,100 - 64,600 )	-19,500
	Decrease in Prepaid Expenses ( 24,700 - 15,000 )	9,700
	Increase in accounts payable ( 64,600 - 52,500 )	12,100
	Decrease in accrued expenses ( 14,800 - 17,900 )	-3,100
	Net Cash flow from operating activities	23,500
	* 7,100 is depreciation of equipment sold . ( 13,200 - 6,100 )
b.)	Cash flows from investing activities	Amount in $
	Sale of Equipment	3,100
	Purchase of Equipment { 90,200 - ( 74,500 - 13,200 ) }	-28,900
	Repayment of Note payable-Bank, long terms	-22,900
	Net Cash flow from Investing activities	-48,700
c.)	Cash flows from financing activities	Amount in $
	Proceeds from issuance of Bonds payable	30,300
	Payment of cash dividends	-10,100
	Net Cash flows from financing activities	20,200