KURTZEL COMPANY Comparative Balance Sheets December


Question Description:

39
KURTZEL COMPANY
Comparative Balance Sheets
December 31
Assets 2014 2013
Cash $ 119,595 $ 68,340
Accounts receivable 68,340 47,838
Inventory 95,676 68,340
Property, plant, and equipment 205,020 266,526
Accumulated depreciation (109,344 ) (82,008 )
Total $379,287   $369,036  
Liabilities and Stockholders’ Equity
Accounts payable $ 64,923 $ 51,255
Income taxes payable 23,919 27,336
Bonds payable 58,089 112,761
Common stock 61,506 47,838
Retained earnings 170,850   129,846  
Total $379,287   $369,036  

 

KURTZEL COMPANY
Income Statement
For the Year Ended December 31, 2014
Sales revenue $826,914
Cost of goods sold 597,975
Gross profit 228,939
Selling expenses $61,506
Administrative expenses 20,502 82,008
Income from operations 146,931
Interest expense 10,251
Income before income taxes 136,680
Income tax expense 27,336
Net income $ 109,344

Additional data:

1. Depreciation expense was $59,797.
2. Dividends declared and paid were $68,340.
3. During the year equipment was sold for $29,045 cash. This equipment cost $61,506 originally and had accumulated depreciation of $32,461 at the time of sale.

 

(a)

Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a – sign e.g. -15,000 or in parenthesis e.g. (15,000).) 

KURTZEL COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2014
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash
    Depreciation Expense     Increase in Inventory     Decrease in Inventory     Payment of Dividends     Increase in Accounts Receivable     Redemption of Bonds     Net Income     Increase in Accounts Payable     Decrease in Accounts Receivable     Sale of Equipment     Increase in Income Taxes Payable     Issuance of Common Stock     Decrease in Accounts Payable     Decrease in Income Taxes Payable $
Adjustments to reconcile net income to
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash
    Decrease in Accounts Receivable     Increase in Accounts Receivable     Sale of Equipment     Depreciation Expense     Issuance of Common Stock     Increase in Inventory     Redemption of Bonds     Decrease in Accounts Payable     Increase in Accounts Payable     Decrease in Income Taxes Payable     Increase in Income Taxes Payable     Payment of Dividends     Decrease in Inventory     Net Income $
    Increase in Accounts Receivable     Decrease in Accounts Payable     Increase in Income Taxes Payable     Net Income     Decrease in Accounts Receivable     Depreciation Expense     Decrease in Inventory     Increase in Accounts Payable     Increase in Inventory     Sale of Equipment     Issuance of Common Stock     Redemption of Bonds     Payment of Dividends     Decrease in Income Taxes Payable
    Payment of Dividends     Net Income     Redemption of Bonds     Decrease in Inventory     Depreciation Expense     Increase in Accounts Payable     Decrease in Accounts Payable     Decrease in Income Taxes Payable     Sale of Equipment     Increase in Income Taxes Payable     Increase in Inventory     Increase in Accounts Receivable     Issuance of Common Stock     Decrease in Accounts Receivable
    Decrease in Accounts Payable     Decrease in Accounts Receivable     Increase in Inventory     Increase in Accounts Payable     Sale of Equipment     Decrease in Income Taxes Payable     Decrease in Inventory     Payment of Dividends     Redemption of Bonds     Net Income     Increase in Income Taxes Payable     Increase in Accounts Receivable     Issuance of Common Stock     Depreciation Expense
    Decrease in Inventory     Increase in Income Taxes Payable     Increase in Inventory     Sale of Equipment     Payment of Dividends     Issuance of Common Stock     Increase in Accounts Receivable     Decrease in Accounts Receivable     Redemption of Bonds     Net Income     Depreciation Expense     Increase in Accounts Payable     Decrease in Accounts Payable     Decrease in Income Taxes Payable
    Cash at Beginning of Period     Cash at End of Period     Cash Flows from Financing Activities     Cash Flows from Investing Activities     Cash Flows from Operating Activities     Net Cash Provided by Financing Activities     Net Cash Provided by Investing Activities     Net Cash Provided by Operating Activities     Net Cash used by Financing Activities     Net Cash used by Investing Activities     Net Cash used by Operating Activities     Net Decrease in Cash     Net Increase in Cash
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash
    Decrease in Accounts Receivable     Sale of Equipment     Payment of Dividends     Decrease in Income Taxes Payable     Increase in Accounts Payable     Issuance of Common Stock     Redemption of Bonds     Net Income     Depreciation Expense     Decrease in Accounts Payable     Increase in Income Taxes Payable     Increase in Accounts Receivable     Increase in Inventory     Decrease in Inventory
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash
    Sale of Equipment     Increase in Accounts Receivable     Decrease in Accounts Payable     Decrease in Inventory     Payment of Dividends     Depreciation Expense     Decrease in Accounts Receivable     Increase in Accounts Payable     Increase in Inventory     Issuance of Common Stock     Redemption of Bonds     Net Income     Decrease in Income Taxes Payable     Increase in Income Taxes Payable
    Sale of Equipment     Decrease in Inventory     Decrease in Accounts Receivable     Decrease in Accounts Payable     Depreciation Expense     Issuance of Common Stock     Increase in Accounts Receivable     Redemption of Bonds     Payment of Dividends     Net Income     Increase in Accounts Payable     Decrease in Income Taxes Payable     Increase in Income Taxes Payable     Increase in Inventory
    Sale of Equipment     Decrease in Inventory     Increase in Inventory     Decrease in Accounts Payable     Redemption of Bonds     Decrease in Income Taxes Payable     Issuance of Common Stock     Payment of Dividends     Increase in Accounts Receivable     Depreciation Expense     Increase in Income Taxes Payable     Net Income     Increase in Accounts Payable     Decrease in Accounts Receivable
    Cash at Beginning of Period     Cash at End of Period     Cash Flows from Financing Activities     Cash Flows from Investing Activities     Cash Flows from Operating Activities     Net Cash Provided by Financing Activities     Net Cash Provided by Investing Activities     Net Cash Provided by Operating Activities     Net Cash used by Financing Activities     Net Cash used by Investing Activities     Net Cash used by Operating Activities     Net Decrease in Cash     Net Increase in Cash
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash $
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(b)

 

Compute these cash-based measures: (Round ratios to 2 decimal places, e.g. 2.56.)

(1) Current cash debt coverage.  times
(2) Cash debt coverage.  times
(3) Free cash flow. $

 

Answer

39