Preparing the statement of cash flows from the cash T-account
The following cash T-account for Holcomb Manufacturing summarizes all the transactions affecting cash during 2012.
|
Cash |
|||
|
Beginning balance |
8,000 |
Inventory purchases |
27,000 |
|
Sales of inventories |
34,000 |
Accounts payable payments |
7,000 |
|
Receivable collections |
40,000 |
Bank loan principal payments |
10,000 |
|
Sales of long-term “investments |
12,500 |
Loan interest |
3,000 |
|
Issuance of common stock |
14,000 |
Wages |
16,000 |
|
Long-term borrowings |
9,000 |
Dividend payments |
4,000 |
|
Administrative expenses |
12,000 |
||
|
Equipment purchases |
11,000 |
||
a. Compute the ending cash balance.
b. Prepare a statement of cash flows (direct method).