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E5-15 (Preparation of a Statement of Cash Flows) Presented below is a condensed version of the comparative balance sheets for Sondergaard Corporation for the last two years at December 31

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ASSIGNMENT No.: 7455118;E5-15 (Preparation of a Statement of Cash Flows) Presented below is a condensed version of the comparative balance sheets for Sondergaard Corporation for the last two years at December 31.;2010 2009;Cash $157,000 $ 78,000;Accounts receivable 180,000 185,000;Investments 52,000 74,000;Equipment 298,000 240,000;Less: Accumulated depreciation (106,000) (89,000);Current liabilities 134,000 151,000;Capital stock 160,000 160,000;Retained earnings 287,000 177,000;Additional information: Investments were sold at a loss (not extraordinary) of $7,000, no equipment was sold, cash dividends paid were $50,000, and net income was $160,000. Instructions;(a) Prepare a statement of cash flows for 2010 for Sondergaard Corporation.;(b) Determine Sondergaard Corporation?s free cash flow..;SOLUTION;a);SONDERGAARD CORPORATION;STATEMENT OF CASH FLOW FOR 2010;Net Income 160,000;Add: deprecation 17,000;Add: Loss on sale of investment 7,000;???-;Cash from operations before NWC changes 184,000;Add: Decrease in accounts receivables 5,000;Less: Decrease in current liabilities -17,000;???-;Net cash flow from operating activities 172,000;Cash flow from investing

 

Paper#20941 | Written in 18-Jul-2015

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