Preparing a Cash Flow Worksheet
Taser Corporation’s recent comparative balance sheet and income statement follow.
Balance Sheets, December 31 2019 2020
Assets Cash and cash equivalents $35,100 $57,420
Accounts receivable (net) 61,200 61,200
Merchandise inventory 140,400 153,000
Investments, long-term 18,000
Plant assets 303,300 324,900
Accumulated depreciation (79,200) (61,200)
Total assets $460,800 $553,320
Liabilities and Stockholders’ Equity Accounts payable $37,800 $34,200
Salaries payable 2,700 900
Income taxes payable 3,600 6,300
Bonds payable 180,000 180,000
Premium on bonds payable 7,200 6,660
Common stock, no-par 216,000 279,900
Retained earnings 13,500 45,360
Total liabilities andstockholders’ equity $460,800 $553,320
Income Statement,
For Year Ended December 31 2020
Sales revenue $216,000
Cost of goods sold (86,400)
Depreciation expense (10,800)
Salaries expense (39,600)
Income tax expense (18,000)
Interest expense (12,600)
Other expenses (4,140)
Gain on sale of plant assets 5,400
Net income $49,860
Additional information
1. Purchased a plant asset, $54,000; issued capital stock in full payment.
2. Purchased a long-term investment in equity securities accounted for cash, $18,000.
3. Declared and paid a cash dividend, $18,000.
4. Sold plant asset for $9,000 cash (cost, $32,400; accumulated depreciation, $28,800).
5. Sold capital stock, 900 shares at $11 per share cash.
Required
Cash Flow Worksheet
Cash Flow Reconciliation
a. Prepare a cash flow worksheet.
Comparative Balance Sheets 2019 Dr. Cr. 2020
Cash and cash equivalents $35,100 22,320
0
57,420
Accounts receivable 61,200 0
0
61,200
Merchandise inventory 140,400 12,600
0
153,000
Investments, long-term 0 18,000
0
18,000
Plant assets 303,300 54,000
32,400
324,900
Accumulated depreciation (79,200) 28,800
10,800
(61,200)
Total assets $460,800 533,320
Accounts payable $37,800 3,600
0
34,200
Salaries payable 2,700 1,800
0
900
Income taxes payable 3,600 0
2,700
6,300
Bonds payable 180,000 0
0
108,000
Premium on bonds payable 7,200 540
0
6,660
Common stock, no par 216,000 0 63,900
279.900
Retained earnings 13,500 ANSWER
ANSWER
45,360
Total liabilities and stockholders' equity $460,800 533,320
Cash Flows from Operating Activities Net income 49,860
0
Depreciation expense 10,800
0
Amortization of bond premium
0 540
Gain on sale of fixed assets 0
5400
Increase in inventory 0
12,600
Decrease in accounts payable 0
3,600
Decrease in salaries payable 0 1,800
Increase in income taxes payable 2,700
0 Cash Flows from Investing Activities Purchase of long-term investments 0
18,000
Proceeds from sale of plant assets 9,000
0
Cash Flows from Financing Activities Dividends paid
0 18,000
Issuance of stock 9,900
0 Net cash and cash equivalents increase 0
22,320 Total ANSWER ANSWER
b. Prepare a reconciliation of the total of the three sections of net cash flows from operating, investing, and financing activities to the change in cash and prepare the noncash disclosure note.
Cash Flow Reconciliation Amount
Net cash provided (used) by operating activities ANSWER
Net cash provided (used) by investing activities ANSWER
Net cash provided (used) by financing activities ANSWER
Net change in cash and cash equivalents ANSWER
Cash and cash equivalents, January 1, 2020 ANSWER
Cash and cash equivalents, December 31, 2020 ANSWER
Noncash Transaction Amount
Purchase of plant assets with stock
ANSWER