Question: (SCF鈥擠irect Method) Los Lobos Corp. uses the direct method to prepare its statement of cash flows. Los Lobos鈥檚 trial balances at December 31, 2017 and 2016, are as follows.
Debits
| December 31
|
| 2017
| 2016
|
Cash | \(35,000 | \)32,000 |
Accounts receivables | 33,000 | 30,000 |
Inventory | 31,000 | 47,000 |
Property, plant and equipment | 100,000 | 95,000 |
Unamortized bond discount | 4,500 | 5,000 |
Cost of goods sold | 250,000 | 380,000 |
Selling expenses | 141,500 | 172,000 |
General and administration expenses | 137,000 | 151,300 |
Interest expenses | 4,300 | 2,600 |
Income tax expenses | 20,400 | 61,200 |
| \(756,700 | \)976,100 |
Credits
| December 31
|
| 2017
| 2016
|
Allowance for doubtful accounts | \(1,300 | \)1,100 |
Accumulated depreciation 鈥� Plant assets | 16,500 | 15,000 |
Account payable | 25,000 | 15,500 |
Income tax payable | 21,000 | 29,100 |
Deferred tax liability | 5,300 | 4,600 |
8% callable bonds payable | 45,000 | 20,000 |
Common stock | 50,000 | 40,000 |
Paid-in-capital in excess of par | 9,100 | 7,500 |
Retained earnings | 44,700 | 64,600 |
Sales revenue | 538,800 | 778,700 |
| \(756,700 | \)976,100 |
Additional information:
1. Los Lobos purchased \(5,000 in equipment during 2017.
2. Los Lobos allocated one-third of its depreciation expense to selling expenses and the remainder to general and administrative expenses.
3. Bad debt expense for 2017 was \)5,000, and write-offs of uncollectible accounts totalled $4,800.
Instructions
Determine what amounts Los Lobos should report in its statement of cash flows for the year ended December 31, 2017, for the following items.
(a) Cash collected from customer | (d) Cash paid for income tax |
(b) Cash paid to suppliers | (e) Cash paid for selling expenses |
(c) Cash paid for interest | |
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