Condensed financial data of Fairchild Company for 2010 and 2009 are presented below

E23-11 (SCF—Indirect Method) Condensed financial data of Fairchild Company for 2010 and 2009 are presented below.

FAIRCHILD COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2010 AND 2009
2011 2010
Cash $1,800 $1,100
Receivables 1,750 1,300
Inventory 1,600 1,900
Plant assets 1,900 1,700
Accumulated depreciation (1,200) (1,170)
Long-term investments (Held-to-maturity) 1,300 1,470
$7,150 $6,300
Accounts payable $1,200 $ 800
Accrued liabilities 200 250
Bonds payable 1,400 1,650
Capital stock 1,900 1,700
Retained earnings 2,450 1,900
$7,150 $6,300

FAIRCHILD COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2010
Sales $6,900
Cost of goods sold 4,700
Gross margin 2,200
Selling and administrative expense 930
Income from operations 1,270
Other revenues and gains
Gain on sale of investments 80
Income before tax 1,350
Income tax expense 540
Net income $ 810

Additional information:
During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2010. Cash dividends were $260.

Instructions
Prepare a statement of cash flows using the indirect method.

Click here for the solution: Condensed financial data of Fairchild Company for 2010 and 2009 are presented below

Data for Fairchild Company are presented in E23-11

E23-12 (SCF—Direct Method) Data for Fairchild Company are presented in E23-11.

Instructions
Prepare a statement of cash flows using the direct method. (Do not prepare a reconciliation schedule.)

Click here for the solution: Data for Fairchild Company are presented in E23-11

(SCF-Indirect Method) Condensed financial data of Pat Metheny Company for 2008 and 2007 are presented below

ACC 421 Week 5

Exercise 23-11 (E23-11) (SCF-Indirect Method) Condensed financial data of Pat Metheny Company for 2008 and 2007 are presented below

AND SO ON

Additional information:
During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2008.

Instructions
Prepare a statement of cash flows using the indirect method.

Click here for the solution: (SCF-Indirect Method) Condensed financial data of Pat Metheny Company for 2008 and 2007 are presented below

ACC 421 Week 5 (SCF-Direct Method) Data for Pat Metheny Company are presented in E23-11

ACC 421 Week 5

Exercise 23-12 (E23-12) (SCF-Direct Method) Data for Pat Metheny Company are presented in E23-11.

Instructions
Prepare a statement of cash flows using the direct method. (Do not prepare a reconciliation schedule.)

Click here for the solution: ACC 421 Week 5 (SCF-Direct Method) Data for Pat Metheny Company are presented in E23-11

George Winston Company, a major retailer of bicycles and accessories, operates several stores and is a publicly traded company

ACC 421 Week 5

Problem 23-7 (P23-7) (SCF-Direct and Indirect Methods from Comparative Financial Statements) George Winston Company, a major retailer of bicycles and accessories, operates several stores and is a publicly traded company. The comparative statement of financial position and income statement for Winston as of May 31, 2008, are shown on the next page. The company is preparing its statement of cash flows.

AND SO ON

The following is additional information concerning Winston’s transactions during the year ended
May 31, 2008.
1. All sales during the year were made on account.
2. All merchandise was purchased on account, comprising the total accounts payable account.
3. Plant assets costing $98,000 were purchased by paying $48,000 in cash and issuing 5,000 shares of stock.
4. The “other expenses” are related to prepaid items.
5. All income taxes incurred during the year were paid during the year.
6. In order to supplement its cash, Winston issued 4,000 shares of common stock at par value.
7. There were no penalties assessed for the retirement of bonds.
8. Cash dividends of $105,000 were declared and paid at the end of the fiscal year.

Instructions
(a) Compare and contrast the direct method and the indirect method for reporting cash flows from operating activities.
(b) Prepare a statement of cash flows for Winston Company for the year ended May 31, 2008, using the direct method. Be sure to support the statement with appropriate calculations. (A reconciliation of net income to net cash provided is not required.)
(c) Using the indirect method, calculate only the net cash flow from operating activities for Winston Company for the year ended May 31, 2008.


Click here for the solution: George Winston Company, a major retailer of bicycles and accessories, operates several stores and is a publicly traded company