Case 2: Financial Statement Case 2: Statement of Cash Flow.
The purpose of this assignment is to review material covered in Acct:2100 and build your cash-flow skills. You may collaborate with colleagues; however, you are required to do your own work and your own case. This assignment can be done in groups of two (2) students. If using this option, submit only one (1) assignment, with both students’ names on it. Use the balance sheet at October 31, 2019 (shown on the next page) and your work-related solution to Case 1.
- Using the direct method, prepare “Danover Inc’s.” Statement of Cash Flows for the year ended October 31, 2019.
- Prepare all required supplemental schedules.
- Ignore income taxes
- Your work is to be done using Microsoft Office’s EXCEL or an EXCEL compatible program.
- Use the Excel Case 2_Student Support EXCEL Worksheet to assist you.
CHECK FIGURES
Net cash flows provided (used) by:
- Investing Activities = $ 94,000
- Financing Activities = $(66,700
| Danover Inc. | |||||
| Balance Sheet | |||||
| October 31 | 2019 | 2018 | Change | ||
| Assets | |||||
| Cash | $ 2,319,131 | $ 126,500 | 2,192,631 | ||
| Accounts receivable | 511,619 | 780,000 | (268,381) | ||
| Allowance for doubtful accounts | (35,813) | (54,600) | 18,787 | ||
| Interest receivable | 4,000 | 4,000 | – | ||
| Inventories | 86,911 | 98,955 | (12,044) | ||
| Prepaid insurance | 7,000 | 6,000 | 1,000 | ||
| Total Current Assets | 2,892,848 | 960,855 | |||
| Investment in Liu Company Bonds (AFS) | 409,625 | 398,100 | 11,525 | ||
| Property, Plant and Equipment, gross | 1,770,450 | 1,724,450 | 46,000 | ||
| Accumulated depreciation | (568,468) | (708,750) | 140,282 | ||
| Total Assets | $ 4,504,455 | $ 2,374,655 | 2,129,800 | ||
| Liabilities | |||||
| Accounts payable | $ 160,075 | $ 189,075 | (29,000) | ||
| Salaries payable | 31,210 | 24,900 | 6,310 | ||
| Interest payable | 4,675 | 1,000 | 3,675 | ||
| Dividends payable | 1,900 | 2,400 | (500) | ||
| Total Current Liabilities | 197,860 | 217,375 | |||
| – | |||||
| Long-term note payable | 594,000 | 300,000 | 294,000 | ||
| Total Liabilities | 791,860 | 517,375 | |||
| – | |||||
| Shareholders’ Equity | – | ||||
| Common stock, no par | 650,000 | 650,000 | – | ||
| Retained Earnings | 3,153,170 | 1,283,180 | 1,869,990 | ||
| Accumulated Other Comprehensive Income | 9,625 | (1,900) | 11,525 | ||
| Treasury stock | (100,200) | (74,000) | (26,200) | ||
| Total Shareholder’s Equity | 3,712,595 | 1,857,280 | |||
| Total Liabilities and Shareholders’ Equity | $ 4,504,455 | $ 2,374,655 | 2,129,800 | ||
