AE13-7 Willingham Corporations comparative balance…

AE13-7


Willingham Corporation's comparative balance sheets are presented below.

WILLINGHAM CORPORATION
Comparative Balance Sheets
December 31

2011
2010

Cash $14,320 $10,830
Accounts receivable 21,010 23,430
Land 20,750 26,280
Building 70,380 70,380
Accumulated depreciation (15,150)
(10,440)

Total $111,310
$120,480


Accounts payable $12,150 $31,090
Common stock 75,030 68,830
Retained earnings 24,130
20,560

Total $111,310
$120,480



Additional information:

Net income was $22,840. Dividends declared and paid were $19,270.

All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for $4,880.






Prepare a statement of cash flows for 2011 using the indirect method. (List multiple entries with a positive cash flow first and then the negative cash flow. List amounts from largest to smallest eg 10, 5, 3, 2. If amount decreases cash flow, use either a negative sign preceding the number eg -45 or parentheses eg (45).)
WILLINGHAM CORPORATION
Statement of Cash Flows
For the Year Ended December 31, 2011

Cash flows from operating activities
Decrease in accounts payableDepreciation expenseLoss on sale of landNet incomeDecrease in accounts receivableIncrease in accounts receivableIssuance of common stockIncrease in accounts payableSale of landPayment of dividends $
Adjustments to reconcile net income
to net cash provided by operating activities
Net incomeLoss on sale of landSale of landDecrease in accounts receivableIncrease in accounts receivablePayment of dividendsIssuance of common stockDecrease in accounts payableDepreciation expenseIncrease in accounts payable $
Loss on sale of landIssuance of common stockSale of landPayment of dividendsDecrease in accounts receivableNet incomeDepreciation expenseIncrease in accounts receivableDecrease in accounts payableIncrease in accounts payable
Increase in accounts payableDecrease in accounts payableSale of landIncrease in accounts receivableIssuance of common stockPayment of dividendsLoss on sale of landDepreciation expenseNet incomeDecrease in accounts receivable
Decrease in accounts receivableSale of landPayment of dividendsIncrease in accounts receivableLoss on sale of landDepreciation expenseIncrease in accounts payableIssuance of common stockNet incomeDecrease in accounts payable


Net cash usedprovided by operating activities

Cash flows from investing activities
Sale of landIncrease in accounts receivableDecrease in accounts payableIncrease in accounts payablePayment of dividendsNet incomeDecrease in accounts receivableDepreciation expenseLoss on sale of landIssuance of common stock

Cash flows from financing activities
Increase in accounts payableSale of landPayment of dividendsIncrease in accounts receivableIssuance of common stockNet incomeDecrease in accounts payableDepreciation expenseLoss on sale of landDecrease in accounts receivable
Sale of landIssuance of common stockDepreciation expenseNet incomeIncrease in accounts payableLoss on sale of landPayment of dividendsIncrease in accounts receivableDecrease in accounts receivableDecrease in accounts payable

Net cash usedprovided by financing activities


Net increasedecrease in cash
Cash at beginning of period

Cash at end of period $








Compute free cash flow. (If amount decreases cash flow, use either a negative sign preceding the number eg -45 or parentheses eg (45).)
$



AE13-5


The current sections of Leach Inc.'s balance sheets at December 31, 2010 and 2011, are presented here.
Leach's net income for 2011 was $152,800. Depreciation expense was $24,440.

2011 2010
Current assets
Cash $105,010 $99,250
Accounts receivable 109,670 89,380
Inventory 158,310 171,580
Prepaid expenses 26,560
21,620

Total current assets $399,550
$381,830


Current liabilities
Accrued expenses payable $14,860 $4,920
Accounts payable 84,690
91,850

Total current liabilities $99,550
$96,770



Prepare the net cash provided by operating activities section of the company's statement of cash flows for the year ended December 31, 2011, using the indirect method. (List amounts from largest positive to smallest positive followed by most negative to least negative, e.g. 15, 14, 10, -17, -5, -1. If amount decreases cash flow, use either a negative sign preceding the number eg. -45 or parentheses eg (45).)

LEACH INC,
Partial Statement of Cash Flows
For the Year Ended December 31, 2011

Cash flows from operating activities
Increase in accounts receivableDecrease in inventoryIncrease in accrued expenses payableDecrease in accounts payableIncrease in prepaid expensesDecrease in prepaid expensesDecrease in accounts receivableIncrease in inventoryDecrease in accrued expenses payableIncrease in accounts payableNet incomeDepreciation expense $
Adjustments to reconcile net income
to net cash provided by operating activities
Increase in accrued expenses payableIncrease in accounts payableDepreciation expenseDecrease in accounts receivableIncrease in inventoryDecrease in prepaid expensesDecrease in accrued expenses payableIncrease in accounts receivableNet incomeDecrease in inventoryIncrease in prepaid expensesDecrease in accounts payable $
Decrease in accounts payableDecrease in inventoryIncrease in accounts receivableDecrease in accrued expenses payableIncrease in accounts payableDecrease in accounts receivableIncrease in inventoryDecrease in prepaid expensesDepreciation expenseNet incomeIncrease in prepaid expensesIncrease in accrued expenses payable
Decrease in accounts payableDecrease in inventoryDecrease in accounts receivableDepreciation expenseIncrease in accounts payableNet incomeIncrease in inventoryDecrease in prepaid expensesDecrease in accrued expenses payableIncrease in prepaid expensesIncrease in accounts receivableIncrease in accrued expenses payable
Net incomeIncrease in accrued expenses payableIncrease in accounts receivableIncrease in accounts payableIncrease in inventoryDecrease in accrued expenses payableDepreciation expenseDecrease in accounts payableDecrease in accounts receivableDecrease in prepaid expensesDecrease in inventoryIncrease in prepaid expenses
Increase in inventoryDecrease in prepaid expensesDecrease in accounts receivableDecrease in accrued expenses payableIncrease in accounts payableIncrease in accounts receivableDecrease in accounts payableDecrease in inventoryIncrease in prepaid expensesDepreciation expenseNet incomeIncrease in accrued expenses payable
Decrease in accounts payableIncrease in accrued expenses payableIncrease in accounts receivableDecrease in accounts receivableIncrease in inventoryDecrease in prepaid expensesNet incomeDecrease in accrued expenses payableDepreciation expenseDecrease in inventoryIncrease in accounts payableIncrease in prepaid expenses


Net cash provided by operating activities $