Author Question: Prepare the statement of cash flows for Franklin Company using the indirect method. Franklin ... (Read 35 times)

mpobi80 · **on:** Jul 6, 2018

Prepare the statement of cash flows for Franklin Company using the indirect method.

Franklin Company
Income Statement
For the Year Ended December 31, 2015

Revenues 9,000
Depreciation expense 650
Other operating expenses 7,100 7,750
Income before income taxes 1,250
Interest expense 440
Income tax expense 270
Net income 540

Franklin Company
Balance Sheet
December 31, 2015 and 2014

2015 2014 2015 2014
Assets: Liab. & SE:
Cash 230 480 A/P 370 550
A/R 510 590 IncTaxes/Pay. 120 280
Inventories 980 960 LT debt 910 830
Plant & Equip. 3,140 2,150 Common Stock 1,100 1,350
Less: Acc. Depr.(1,520) (870) Retained Earnings 840 300
Total Assets 3,340 3,310 Total Liab. & SE 3,3403,310

What will be an ideal response?

Question 2

Form 941 must be submitted quarterly.
Indicate whether the statement is true or false

14vl19 · **Reply #1 on:** Jul 6, 2018

Answer to Question 1

Franklin Company
Statement of Cash Flows
For the Year Ended December 31, 2015

Net income 540
Adjustments to reconcile net income
to net cash provided by (used for)
operating activities:
Depreciation 650
Changes in assets and liabilities:
Accounts receivable 80
Inventory (20)
Accounts payable (180)
Income taxes payable (160)
Net cash provided by operating activities 910
Cash flows from investing activities:
Capital expenditures (990)
Net cash used by investing activities (990)
Cash flows from financing activities:
Proceeds from long-term debt 80
Repurchase of common stock (250)
Net cash used by financing activities (170)
Net increase (decrease) in cash (250)
Cash at beginning of period 480
Cash at end of period 230

Answer to Question 2

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