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1Introduction to Financial Accounting Solutions to practice questions - Cash Flow Statement Smithson Ltd.

Cash Flow Statement for the year ended June 30, 2000 CASH PROVIDED (USED) BY OPERATING ACTIVITIES Net income $13,290 Non-cash items Amortization expense 3,000 Loss on sale of equipment 300 16,590 Changes in non-cash working capital balances Accounts receivable 450 Inventory ( 1,780) Prepaid expenses ( Accounts payable 1,270 Salary payable ( 16,290 INVESTING ACTIVITIES Purchase of land 110) 130)

Cash Flow Statement for the year ended December 31.000) Proceeds on the sale of equipment 800 ( 1.490 Cash.500 ( 7.000) Increase (decrease) in cash during the year $ 8.090 2. 1998 CASH PROVIDED (USED) BY OPERATING ACTIVITIES . start of year 1.000) 2.400 Increase (decrease) in cash during the year $ 8.500) Payment of long term debt ( Proceeds on the issuance of common shares 5.200) FINANCING ACTIVITIES Payment of dividends ( 10. Westman Industries Ltd. end of year $ 9.090 Proof: Cash.( 2.

250 INVESTING ACTIVITIES Purchase of buildings ( 10.500) Inventory 2.500 31.800 Non-cash items Amortization expense 4.Net income $22.300 Changes in non-cash working capital balances Accounts receivable ( 1.000) Purchase of patent ( 5.000) 350) 100) .000 Prepaid expenses ( Accounts payable 400 Unearned revenue ( Income taxes payable 500 32.000 Loss on sale of equipment 4.

000 Reacquisition of common shares ( 17.000 Increase (decrease) in cash during the year $ 7.000) Camel Corporation Cash Flow Statement for the year ended December 31.300 ( 10.Proceeds on the sale of equipment 4.550 7.550 Cash.550 Proof: Cash. start of year 7. end of year $ 14.700) FINANCING ACTIVITIES Payment of dividends ( Proceeds on bond issue 10.000) Increase (decrease) in cash during the year $ 7. 1999 CASH PROVIDED (USED) BY OPERATING ACTIVITIES .000) ( 14.

700 Changes in non-cash working capital balances Accounts receivable 16.000 Income taxes payable 14.700 Inventory 16.000) FINANCING ACTIVITIES .600 Accounts payable ( 32.000 ( 205.000) 169.000) Purchase of temporary investments ( 45.200 Non-cash items Amortization expense 28.400) Unearned revenue 16.000 200.500 Gain on sale of equipment ( 35.000) Proceeds on the sale of equipment 60.Net income $176.600 INVESTING ACTIVITIES Purchase of equipment ( 220.

000 ( 5.400 Increase (decrease) in cash during the year $( 9.Payment of dividends ( Proceeds on the issuance of bonds 35.000 9.000) . start of year 33.000) Increase (decrease) in cash during the year $( Proof: Cash.400) 24. end of year $ Cash.400) 40.