Use the following information regarding the Lund Corporation to (a) prepare a statement of cash flows using the indirect method and (b) compute Lund's operating-cash-flow-to-current-liabilities ratio.   Accounts payable increase $13,500 Accounts receivable increase 6,000 Accrued liabilities decrease 4,500 Amortization expense 9,000 Cash balance, January 1 33,000 Cash balance, December 31 22,500 Cash paid as dividends 43,500 Cash paid to purchase land 135,000 Cash paid to retire bonds payable at par 90,000 Cash received from issuance of common stock 52,500 Cash received from sale of equipment 25,500 Depreciation expense 43,500 Gain on sale of equipment 6,000 Inventory decrease 19,500 Net income 114,000 Prepaid expenses increase 3,000 Average current liabilities 150,000 a. Use negative signs with cash outflow answers. LUND CORPORATION Statement of Cash Flows For Year Ended December 31 Cash Flow from Operating Activities Net Income Answer   Add (deduct) items to convert net income to cash basis Depreciation Answer   Amortization Answer   Gain on Sale of Equipment Answer   Accounts Receivable Increase Answer   Inventory Decrease Answer   Prepaid Expenses Increase Answer   Accounts Payable Increase Answer   Accrued Liabilities Decrease Answer   Cash Flow Provided by Operating Activities Answer   Cash Flow from Investing Activities Sale of Equipment Answer   Purchase of Land Answer   Cash Used by Investing Activities Answer   Cash Flow from Financing Activities Issuance of Common Stock Answer   Retirement of Bonds Payable Answer   Payment of Dividends Answer   Cash Used by Financing Activities Answer   Net Decrease in Cash Answer   Cash at Beginning of Year Answer   Cash at End of Year Answer   b. Operating-cash-flow-to-current-liabilities ratio (Round answers to two decimal places.)

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ISBN:9781259964947
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Chapter1: Financial Statements And Business Decisions
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Statement of Cash Flows (Indirect Method)
Use the following information regarding the Lund Corporation to (a) prepare a statement of cash flows using the indirect method and (b) compute Lund's operating-cash-flow-to-current-liabilities ratio.

 

Accounts payable increase $13,500
Accounts receivable increase 6,000
Accrued liabilities decrease 4,500
Amortization expense 9,000
Cash balance, January 1 33,000
Cash balance, December 31 22,500
Cash paid as dividends 43,500
Cash paid to purchase land 135,000
Cash paid to retire bonds payable at par 90,000
Cash received from issuance of common stock 52,500
Cash received from sale of equipment 25,500
Depreciation expense 43,500
Gain on sale of equipment 6,000
Inventory decrease 19,500
Net income 114,000
Prepaid expenses increase 3,000
Average current liabilities 150,000


a. Use negative signs with cash outflow answers.

LUND CORPORATION
Statement of Cash Flows
For Year Ended December 31
Cash Flow from Operating Activities
Net Income Answer
 
Add (deduct) items to convert net income to cash basis
Depreciation Answer
 
Amortization Answer
 
Gain on Sale of Equipment Answer
 
Accounts Receivable Increase Answer
 
Inventory Decrease Answer
 
Prepaid Expenses Increase Answer
 
Accounts Payable Increase Answer
 
Accrued Liabilities Decrease Answer
 
Cash Flow Provided by Operating Activities Answer
 
Cash Flow from Investing Activities
Sale of Equipment Answer
 
Purchase of Land Answer
 
Cash Used by Investing Activities Answer
 
Cash Flow from Financing Activities
Issuance of Common Stock Answer
 
Retirement of Bonds Payable Answer
 
Payment of Dividends Answer
 
Cash Used by Financing Activities Answer
 
Net Decrease in Cash Answer
 
Cash at Beginning of Year Answer
 
Cash at End of Year Answer
 


b. Operating-cash-flow-to-current-liabilities ratio (Round answers to two decimal places.)

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