Question

The following transactions pertain to the operations of Ewing company for year 2.

1.Acquired $30,000 cash from the issue of common stock
2.Provided $65,000 of services on account
3.Paid $22,000 cash on accounts payable
4.Performed services for $8000 cash
5.Collected $51,000 cash from accounts receivable
6.Incurred $37,000 of operating expenses on account
7.Paid $6500 cash for one years rent in advance
8.Paid a $4000 cash dividend to the stockholders
9.Paid $1200 cash for supplies to be used in the future
10.Recognize $3100 of accrued salary expense

Prepare a statement of cash flow‘s. The beginning cash balance was $6700.

Answer 1

The statement of cash flows shows the cash inflows and outflows of a company. Based on the provided transactions, the statement of cash flows for Ewing Company in year 2 can be prepared. The transactions are categorized into operating, investing, and financing activities.

Step-by-step explanation:

The statement of cash flows reports the cash inflows and cash outflows of a company during a specific period. It categorizes cash flows into three main sections: operating activities, investing activities, and financing activities.

Based on the provided transactions, here is the statement of cash flows for Ewing Company for year 2:

1. Cash flows from operating activities:
   • Received $65,000 from accounts receivable
   • Paid $22,000 on accounts payable
   • Incurred $37,000 of operating expenses on account
   • Recognized $3,100 of accrued salary expense
2. Cash flows from investing activities:
   • Paid $1,200 for supplies
3. Cash flows from financing activities:
   • Acquired $30,000 cash from the issue of common stock
   • Paid $6,500 for one year's rent in advance
   • Paid $4,000 cash dividend to stockholders

By considering the cash flows from each activity, you can determine the net change in cash for the period, which you can add to the beginning cash balance to obtain the ending cash balance.

Answer 2

ending cash balance 62,000

Step-by-step explanation:

operating activities:

services on cash 8,000

collected from AR 51,000

paid to supplies (22,000)

rent paid (6,500)

supplies paid (1,200)

cash generated from operating: 29,300

financing activities:

issuance of stock 30,000

cash dividends paid (4,000)

cash generated from financing: 26,000

cash generated during the year: 55,300

beginning cash balance 6, 700

ending cash balance 62,000