Willingham Corporation's comparative balance sheets are presented below.
WILLINGHAM CORPORATION
Comparative Balance Sheets December 31
2011 2010
Cash $14,330 $10,580
Accounts receivable 21,160 23,310
Land 20,840 26,040
Building 70,200 70,200
Accumulated depreciation (15,000) (10,330)
Total $111,530 $119,800
Accounts payable $12,160 $31,010
Common stock 74,860 69,170
Retained earnings 24,510 19,620
Total $111,530 $119,800
Additional information:
1. Net income was $22,940. Dividends declared and paid were $18,050.
2. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for $4,740.
Prepare a statement of cash flows for 2011 using the indirect method. (List multiple entries with a
positive cash flow first and then the negative cash flow. List amounts from largest to smallest eg 10,
5, 3, 2. If amount decreases cash flow, use either a negative sign preceding the number eg -45 or
parentheses eg (45).)
WILLINGHAM CORPORATION
Statement of Cash Flows
For the Year Ended December 31, 2011
Cash flows from operating activities
Sale of land
Increase in accounts payable
Decrease in accounts payable
Net income Loss on sale of
Land Issuance of common stock Depreciation expense Payment of dividends Decrease in accounts
Receivable Increase in accounts receivable $
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation expense Issuance of common stock Loss on sale of land Decrease in accounts payable Payment of dividends Decrease in accounts receivable Increase in accounts receivable Net income Increase in accounts payable Sale of land $
Net income Depreciation expense Decrease in accounts payable Increase in accounts payable Decrease in accounts receivable Issuance of common stock Payment of dividends Sale of land Loss on sale of land Increase in accounts receivable
Net income Loss on sale of land Increase in accounts payable Payment of dividends Sale of land Increase in accounts receivable Depreciation expense Decrease in accounts payable Decrease in accounts receivable Issuance of common stock
Payment of dividends Increase in accounts payable Loss on sale of land Depreciation expense Decrease in accounts payable Decrease in accounts receivable Sale of land Issuance of common stock Increase in accounts receivable Net income
Net cash provided used by operating activities
Cash flows from investing activities
Payment of dividends Net income Sale of land Decrease in accounts payable Increase in accounts
Payable Issuance of common stock Depreciation expense Loss on sale of land Increase in accounts
Receivable Decrease in accounts receivable
Cash flows from financing activities
Depreciation expense Issuance of common stock Decrease in accounts receivable Loss on sale of
Land Net income Increase in accounts receivable Payment of dividends Increase in accounts payable Decrease in accounts payable Sale of land
Issuance of common stock Net income Loss on sale of land Sale of land Decrease in accounts receivable Decrease in accounts payable Payment of dividends Increase in accounts receivable Increase in accounts payable Depreciation expense
Net cash provided used by financing activities
Net increase decrease in cash
Cash at beginning of period
Cash at end of period $
Compute free cash flow. (If amount decreases cash flow, use either a negative sign preceding the number eg -45 or parentheses eg (45).)
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