Prepare a statement of cash flows using the direct method

Reference no: EM13568076

The following transactions occurred during February 2013 for the Quest Company. The company owns and operates a wholesale warehouse.
1.Issued 35,000 shares of capital stock in exchange for $350,000 in cash.

2.Purchased equipment at a cost of $50,000. $10,000 cash was paid and a note payable was signed for the balance owed.

3.Purchased inventory on account at a cost of $85,000. The company uses the perpetual inventory system.

4.Credit sales for the month totaled $132,000. The cost of the goods sold was $77,000.

5.Paid $5,500 in rent on the warehouse building for the month of March.

6.Paid $7,000 to an insurance company for fire and liability insurance for a one-year period beginning March 1, 2013.

7.Paid $72,000 on account for the merchandise purchased in 3.

8.Collected $43,000 from customers on account.

9.Recorded depreciation expense of $1,200 for the month on the equipment.
Required:
Prepare a statement of cash flows, using the direct method to present cash flows from operating activities. Assume the cash balance at the beginning of the month was $40,000.

Reference no: EM13568076

Questions Cloud

What is the difference in basis points between the discount : what is the difference in basis points between the discount rate of return dr and the investment rate of return ir on

The topic for todays assignment is financial statements why : i need you to write this assignment. please see the explanation.explanationas part of the development processyou will

Goldenlock company manufactures watches and has a jit : goldenlock company manufactures watches and has a jit policy that ending inventory must equal 20 of the next months

Jiminy cricket removal has a profit margin of 9 percent : jiminy cricket removal has a profit margin of 9 percent total asset turnover of 1.15 and roe of 14.31

Prepare a statement of cash flows using the direct method : the following transactions occurred during february 2013 for the quest company. the company owns and operates a

On april 1 you covered the short sale by buy- ing the stock : on january 1 you sold short one round lot that is 100 shares of lowes stock at 21 per share. on march 1 a dividend of 2

As part of the development processyou will be submitting : i need you to write this assignment. please see the explanation.explanationas part of the development processyou will

In a year in which common stocks offered an average return : in a year in which common stocks offered an average return of 18 treasury bonds offered 10 and treasury bills offered 7

A teen purchases a car for 21000 he finances the entire : a teen purchases a car for 21000. he finances the entire amount at an annual interest rate of 5.9 for 4 years. what is

User Account

All Pages