Question :
BRIEF EXERCISES
BE 156
Selected transactions for the Ecker Company listed below.
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BRIEF EXERCISES
BE 156
Selected transactions for the Ecker Company are listed below.
1. Collected accounts receivable.
2. Declared and paid dividends on common stock.
3. Sold long-term investments for cash.
4. Issued stock for equipment.
5. Repaid five year note payable.
6. Paid employee wages.
7. Converted bonds payable to common stock.
8. Acquired long-term investment with cash.
9. Sold buildings and equipment for cash.
10. Sold merchandise to customers.
Instructions
Classify each transaction as either (a) an operating activity, (b) an investing activity, (c) a financing activity, or (d) a noncash investing and financing activity.
BE 157
Barton Company had net income of $193,000 in 2013. Depreciation expense for the year is $48,000. During the year, Accounts Receivable increased $9,000 and Prepaid Expenses decreased $1,000. The company also sold equipment at a loss of $3,000.
Instructions
Calculate net cash flows from operating activities using the indirect method.
BE 158
During 2013, Blaine Company sold a building with a book value of $145,000 for proceeds of $175,000. The company also sold long-term investments for proceeds of $32,000. The company purchased land and a new building for $320,000 by signing a long-term note payable. No other transactions impacted long-term asset accounts during 2013.
Instructions
Compute net cash flows from investing activities.
BE 159
Monroe Company issued common stock for proceeds of $21,000 during 2013. The company paid dividends of $3,000. The company also issued a long-term note payable for $30,000 in exchange for equipment during the year. The company sold treasury stock that had a cost of $3,000 for $8,000.
Instructions
Compute net cash flows from financing activities.
BE 160
At January 1, 2013, Benny Enterprises reported a balance in the Equipment account of $45,000. During the year the company purchased equipment with a cost of $60,000 and sold equipment with a book value of $30,000. The company reported a loss on the sale of equipment of $4,000. Assume the indirect method is used.
Instructions
Determine what amount will be reported in (a) the operating activities section and (b) the investing activities section with regard to the purchase and sale of equipment.
BE 161
Assume the indirect method is used to compute cash flows from operations. For each item listed below, indicate the effect on net income in arriving at cash flows from operations by choosing one of the following code letters.
Code
Cash Flows From Operating Activities
Add to Net IncomeA
Deduct from Net IncomeD
1. Increase in accounts receivable
2. Increase in inventory
3. Decrease in prepaid expenses
4. Decrease in accounts payable
5. Increase in accrued liabilities
6. Increase in income taxes payable
7. Depreciation expense
8. Loss on sale of investment
9. Gain on disposal of equipment
10. Amortization expense
