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The following information is available for Bridgeport Corp. for the year ended December 31, 2022.

Beginning cash balance: $74,250
Accounts payable decrease: 6,105
Depreciation expense: 267,300
Accounts receivable increase: 13,530
Inventory increase: 18,150
Net income: 468,765
Cash received for sale of land at book value: 57,750
Cash dividends paid: 19,800
Income taxes payable increase: 7,755
Cash used to purchase building: 476,850
Cash used to purchase treasury stock: 42,900
Cash received from issuing bonds: 330,000

Required:
Prepare a statement of cash flows using the indirect method.

Respuesta :

amanarsalan

Answer:

Please see below the Cash Flow Statement for Bridgeport Corp. for the year ended December 31, 2022.

Explanation:

(A) Beginning cash balance                                                        $74,250

CASH FLOW FROM OPERATING ACTIVITIES:

Net Income                                                                           $468,765

Adjustments to reconcile Net Income:

Add: Depreciation expense                                                $267,300

(Increase) Decrease in Current Assets:

Accounts receivable                                                             ($13,530)

Inventory                                                                                ($18,150)

Increase (Decrease) in Current Liabilities:

Accounts payable                                                                   ($6,105)

Income taxes payable                                                             $7,755

(B) NET CASH PROVIDED BY OPERATING ACTIVITIES     $706,035

CASH FLOWS FROM INVESTING ACTIVITIES:

Cash received for sale of land                                              $57,750

Cash used to purchase building                                       ($476,850)

(C) NET CASH PROVIDED BY INVESTING ACTIVITIES      ($419,100)

CASH FLOWS FROM FINANCING ACTIVITIES:

Cash received from issuing bonds                                    $330,000

Cash used to purchase treasury stock                               ($42,900)

Cash dividends paid                                                             ($19,800)

(D) NET CASH PROVIDED BY FINANCING ACTIVITIES       $267,300

(E = B + C + D) NET INCREASE IN CASH                                     $554,235

(A + E) ENDING CASH BALANCE                                              $628,485