Rolando E. Caser Jr.

Financial Management
BSA-3A MWF 9:30AM-10:30AM

1 Plant assets 85,000

Cash 85,000

2 Cash 10,000
Accumulated depreciation (25,000-13,000) 12,000
Loss on sale on plant assets 3,000
Plant assets 25,000

3 Bonds payable 30,000

Common stock 30,000

4 Retained earnings 24,000

Cash dividends payable 24,000

Cash dividends payable 24,000

Cash 24,000

5 Merchandise inventory 20,000

Accounts payable (95,000-75,000) 20,000

Accounts receivable, 12/31/2018 53,000

Add: Sales 480,000
Total 533,000
Less: Accounts receivable, 12/31/2019 82,000
Collection from customers 451,000

Cost of goods sold 290,000

Add: Merchandise inventory, 12/31/2019 120,000
Total 410,000
Less: Merchandise inventory, 12/31/2018 132,000
Purchases 278,000
Add: Accounts payable, 12/31/2018 75,000
Total 353,000
Less: Accounts payable, 12/31/2019 95,000
Payment to suppliers 258,000

Operating expenses 60,000

Add: Prepaid expenses, 12/31/2019 19,000
Accrued expenses, 12/31/2018 24,000 43,000
Total 103,000
Less: Prepaid expenses, 12/31/2018 25,000
Accrued expenses, 12/31/2019 22,000 47,000
Payment of operating expenses 56,000
Accumulated depreciation, 12/31/2019 65,000
Accumulated depreciation of plant asset sold 12,000
Total 77,000
Accumulated depreciation, 12/31/2018 (60,000)
Depreciation 17,000

Payment of income tax 15,000

Payment of interest 18,000

Mannon Company
Statement of Cash Flows
For the year ended December 31, 2019

Cash flows from operating activities

Collection from customers 451,000
Payment to suppliers (258,000)
Payment of operating expenses (56,000)
Cash flow generated from operations 137,000
Payment of income tax (15,000)
Payment of interest (18,000)
Net cash provided by operating activities 104,000
Cash flows from investing activities
Purchase of investments (15,000)
Purchase of plant assets (85,000)
Sale of plant assets 10,000
Net cash used in investing activities (90,000)
Cash flows from financing activities
Issuance of common stock 45,000
Payment of cash dividends (24,000)
Net cash provided by financing activities 21,000
Net increase in cash 35,000
Add: Cash, 12/31/2018 35,000
Cash, 12/31/2019 70,000

Net cash provided by operating activities 104,000

Divided by average current liabilities
Current liabilities, 12/31/2018 99,000
Current liabilities, 12/31/2019 117,000
Total 216,000
Divided by 2 years 2 108,000
Current cash debt coverage ratio 0.96
Net cash provided by operating activities 104,000
Divided by average total liabilities
Total liabilities, 12/31/2018 249,000
Total liabilities, 12/31/2019 237,000
Total 486,000
Divided by 2 years 2 243,000
Cash debt coverage ratio 0.43