Instructions for the Microsoft Excel Templates by Rex A Schildhouse

Be advised, the template workbooks and worksheets are not protected. Overtyping any data may remove it.
Extensive detail and information is contained within the help function of Microsoft Excel and in the provided text. You should enter your name, date, instructor's name, and course into the cells at the top of the page. This information will be printed on the top of each page if the template requires more than one page. Each template is set to print with File Name, Page # of # Page(s), the print date, and the print time to assist in assembly of multiple pages. If more than one page is required by the template, manual page breaks have been set to provide consistent presentation. All of the cells have been correctly formatted for presentation and should not require any adjustment. For example, if the text requires one, two, or three significant digits in a presentation, the template has been set for that presentation in the appropriate cells. In general, the yellow highlighted cells are the cells which work and effort should be presented. These entries may include date(s), account title(s), values, memorandum appropriate to the entry, or text answers to questions. And information or data which may be required by the solution will be entered in cells with borders to help identify them. Where a yellow highlighted cell shows "Date" enter the appropriate date for that step of the challenge. This may be any date format that Microsoft Excel accepts. Some of these formats include "1/1/12", "01/01/12", and "01/01/2012." All of these will return January 01, 2012, in the format set in the template. Where a yellow highlighted cell shows "Acct Nbr" enter the appropriate account number, provided in the template and in the text for that step of the challenge. This is entry may be a "Look to" formula to another cell where that information has been provided or previously entered. Where a yellow highlighted cell shows "Account Title" enter the appropriate account title for that step of the challenge. This is a text entry and most of those cells are set for the proper indentation for that step. Frequently the chart of accounts appropriate to the challenge is provided and you can use the "look to" formula to reference the appropriate account title without typing it. Check with your instructor to see if abbreviated account titles are acceptable. For example "A/R" for Accounts Receivable, "A/P" for Accounts Payable. If your instructor is using a comparison process between workbooks for grading, these abbreviates may not be acceptable. Where a yellow highlighted cell shows titles such as "Values," "Amounts," or "Quantities" enter the appropriate numerical value for that step of the challenge. The cell is formatted for proper presentation of the entered information. If a dollar sign is appropriate, it should not be entered, Microsoft Excel will place it there through formatting. Commas and significant digits (decimals) are also set through formatting for common presentation. Since the formatting of the templates is not protected by any password, you may change any of the formatting found in the templates to meet your desires. Where a yellow highlighted cell shows titles such as "Formula" you may enter the appropriate formula or enter a numerical value appropriate for that step of the challenge. Most of the values necessary for the appropriate formula are located on the template in cells with borders or in other yellow highlighted cells. The formula may be a simple "Look to" formula, an equal sign and a cell reference, "=E27" or more complex as "=E27*5," or something similar to the time-value-of-money formula. These are addressed in the tutorial text provided for Microsoft Excel.

Where a yellow highlighted cell shows titles such as "Formula" you may enter the appropriate formula or enter a numerical value appropriate for that step of the challenge. Most of the values necessary for the appropriate formula are located on the template in cells with borders or in other yellow highlighted cells. The formula may be a simple "Look to" formula, an equal sign and a cell reference, "=E27" or more complex as "=E27*5," or something similar to the time-value-of-money formula. These are addressed in the tutorial text provided for Microsoft Excel. Where a yellow highlighted cell shows "Text" enter the appropriate text for that step of the challenge. This may be a memorandum entry for a journal entry or a lengthy text answer discussing the results of an analysis of a company's financials. These titles can simply be typed over. Where a yellow highlighted cell shows titles such as "Journal Number" or "Journ #" you should enter the appropriate number provided in the template and in the text for that step of the challenge. In general this will appear in instances such as "Record the following events in General Journal number six." The print area is defined to fit onto 8 1/2" 11" sheets in portrait or landscape mode as required. Margins are generally set to no less than 1/2" so most printers can print them without a problem. If you printer cannot accept margins less than 1" you may have to reformat the margins through Page Setup. The display may have "Freeze Pane" invoked so column titles remain visible during data entry. This can be removed by utilizing the View menu and selecting "Unfreeze Panes" under "Freeze Panes." When negative values are required, enter them by starting with a minus sign, "-". Negative values may be shown as ($400) or -$400. Negative values in formulas can be created by putting a minus sign in front of the cell reference - "=E10*-E11" will return a negative value if both cells E10 and E11 contain positive values. Microsoft Office and Microsoft Excel are products of, and copyrighted by, Microsoft Corporation, One Microsoft Way, Redmond, Washington 98052-6399

Solution Name: Date: Instructor: Course: th Intermediate Accounting, 14 Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
E5-7 (Current Assets Section of the Balance Sheet) Presented below are selected accounts of Aramis Company at December 31, 2012. Finished Goods Unearned Revenue Equipment Work in Process Cash Equity Investments (Short-term) Customer Advances Cash Restricted for Plant Expansion $52,000 90,000 253,000 34,000 42,000 31,000 36,000 50,000 Cost of Goods Sold Notes Receivable Accounts Receivable Raw Materials Supplies Expense Allowance for Doubtful Accounts Licenses Additional Paid-in Capital Treasury Stock $2,100,000 40,000 161,000 187,000 60,000 12,000 18,000 88,000 22,000

The following additional information is available: 1. Inventories are valued at lower-of-cost-or-market using LIFO. 2. Equipment is recorded at cost. Accumulated depreciation, computed on a straight-line basis, is $50,600 3. The short-term investments have a fair value of $29,000 (Assume they are trading securities.) 4. The notes receivables are due April 30, 2014, with interest receivable every April 30. The notes bear interest at 6% (Hint: Accrue interest due on December 31, 2012.) 5. The allowance for doubtful accounts applies to the accounts receivable. Accounts receivable of $50,000 are pledged as collateral on a bank loan. 6. Licenses are recorded net of accumulated amortization of $14,000 7. Treasury stock is recorded at cost. Instructions: Prepare the current assets section of Aramis Companys December 31, 2012, balance sheet, with appropriate disclosures. Current assets Cash Less: Cash Restricted for Plant Expansion Equity Investments (Short-term) Accounts receivable (of which $50,000 is pledged as collateral on a bank loan) Less: Allowance for Doubtful Accounts Interest receivable [($40,000 6.00%) 8/12] Inventories at lower-of-cost-(determined using LIFO)-or-market Finished Goods Work in Process Raw Materials Total current assets

$92,000 (50,000)

$42,000 29,000

161,000 (12,000)

149,000 1,600

52,000 34,000 187,000

273,000 $494,600

*An acceptable alternative is to report cash at $42,000 and simply report the cash restricted for plant expansion, $50,000, in the investments section.

153010870.xlsx.ms_office, Exercise 5-7 Solution, Page 3 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: Intermediate Accounting, 14th Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
E5-7 (Current Assets Section of the Balance Sheet) Presented below are selected accounts of Aramis Company at December 31, 2012. Finished Goods Unearned Revenue Equipment Work in Process Cash Equity Investments (Short-term) Customer Advances Cash Restricted for Plant Expansion $52,000 90,000 253,000 34,000 42,000 31,000 36,000 50,000 Cost of Goods Sold Notes Receivable Accounts Receivable Raw Materials Supplies Expense Allowance for Doubtful Accounts Licenses Additional Paid-in Capital Treasury Stock $2,100,000 40,000 161,000 187,000 60,000 12,000 18,000 88,000 22,000

The following additional information is available: 1. Inventories are valued at lower-of-cost-or-market using LIFO. 2. Equipment is recorded at cost. Accumulated depreciation, computed on a straight-line basis, is $50,600 3. The short-term investments have a fair value of $29,000 (Assume they are trading securities.) 4. The notes receivables are due April 30, 2014, with interest receivable every April 30. The notes bear interest at 6% (Hint: Accrue interest due on December 31, 2012.) 5. The allowance for doubtful accounts applies to the accounts receivable. Accounts receivable of $50,000 are pledged as collateral on a bank loan. 6. Licenses are recorded net of accumulated amortization of $14,000 7. Treasury stock is recorded at cost. Instructions: Prepare the current assets section of Aramis Companys December 31, 2012, balance sheet, with appropriate disclosures. Current assets Title Title Title Title Title Title Inventories at lower-of-cost-(determined using LIFO)-or-market Title Title Title Total current assets

Amount Amount

Formula Amount

Amount Amount

Formula Amount

Amount Amount Amount

Formula Formula

153010870.xlsx.ms_office, Exercise 5-7, Page 4 of 18, 6/20/2013, 6:59 AM

Solution Name: Date: Instructor: Course: Intermediate Accounting, 14th Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
E5-11 (Balance Sheet Presentation) Presented below is the adjusted trial balance of Abbey Corporation at December 31, 2012. Debits Credits Cash ?? Supplies $1,200 Prepaid Insurance 1,000 Equipment 48,000 Accumulated Depreciation - Equipment $9,000 Trademarks 950 Accounts Payable 10,000 Salaries and Wages Payable 500 Unearned Service Revenue 2,000 Bonds Payable, due 2017 9,000 Common Stock 10,000 Retained Earnings 20,000 Service Revenue 10,000 Salaries and Wages Expense 9,000 Insurance Expense 1,400 Rent Expense 1,200 Interest Expense 900 Total ?? ?? Additional information: 1. Net loss for the year was $2,500 2. No dividends were declared during 2012. Instructions: Prepare a classified balance sheet as of December 31, 2012. Solution to cash: Total liabilities and shareholders' equity = $49,000 less known assets of Supplies $1,200 + Prepaid Insurance of $1,000 + Equipment of $48,000 + Trademarks of $950 plus Accumulated Depreciation - Equipment of $9,000 ABBEY CORPORATION Balance Sheet December 31, 2012 Assets Current assets Cash Supplies Prepaid Insurance Total current assets Equipment Accumulated Depreciation - Equipment Intangible assets - Trademarks Total assets $6,850 1,200 1,000 $9,050 48,000 9,000 39,000 950 $49,000

153010870.xlsx.ms_office, Exercise 5-11 Solution, Page 5 of 18, 6/20/2013, 6:59 AM

Solution Name: Date: Instructor: Course: Liabilities and Shareholders Equity and Warfield Intermediate Accounting , 14th Edition by Kieso, Weygandt,
Current liabilities Accounts Payable Salaries and Wages Payable Unearned Service Revenue Total current liabilities Bonds Payable, due 2017 Total liabilities Shareholders equity Common Stock Retained Earnings Total shareholders equity Total liabilities and shareholders equity Computation of retained earnings: Retained Earnings - Beginning balance Net loss Retained Earnings - Ending balance or: Service Revenue Less: Salaries and Wages Expense Less: Insurance Expense Less: Rent Expense Less: Interest Expense Period Net income / (Net loss) Retained Earnings - Beginning balance Retained Earnings - Ending balance $10,000 $9,000 1,400 1,200 900 $10,000 500 2,000 $12,500 9,000 21,500

10,000 17,500 27,500 $49,000

$20,000 (2,500) $17,500

12,500 (2,500) 20,000 $17,500

153010870.xlsx.ms_office, Exercise 5-11 Solution, Page 6 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: Intermediate Accounting, 14th Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
E5-11 (Balance Sheet Presentation) Presented below is the adjusted trial balance of Abbey Corporation at December 31, 2012. Debits Credits Cash ?? Supplies $1,200 Prepaid Insurance 1,000 Equipment 48,000 Accumulated Depreciation - Equipment $9,000 Trademarks 950 Accounts Payable 10,000 Salaries and Wages Payable 500 Unearned Service Revenue 2,000 Bonds Payable, due 2017 9,000 Common Stock 10,000 Retained Earnings 20,000 Service Revenue 10,000 Salaries and Wages Expense 9,000 Insurance Expense 1,400 Rent Expense 1,200 Interest Expense 900 Total ?? ?? Additional information: 1. Net loss for the year was $2,500 2. No dividends were declared during 2012. Instructions: Prepare a classified balance sheet as of December 31, 2012. Solution to cash as desired.

ABBEY CORPORATION Balance Sheet December 31, 2012 Assets Current assets Account Title Account Title Account Title Total current assets Account Title Account Title Account Title Total assets Amount Amount Amount Formula Amount Amount Formula Amount Formula

153010870.xlsx.ms_office, Exercise 5-11, Page 7 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: Liabilities and Shareholders Equity and Warfield Intermediate Accounting , 14th Edition by Kieso, Weygandt,
Current liabilities Account Title Account Title Account Title Total current liabilities Account Title Total liabilities Shareholders equity Account Title Account Title Total shareholders equity Total liabilities and shareholders equity Computation of retained earnings: Account Title Title Account Title or: Title Less: Account Title Less: Account Title Less: Account Title Less: Account Title Period Net income / (Net loss) Title Title Formula Amount Amount Amount Amount Amount Amount Amount Formula Amount Formula

Amount Amount Formula Formula

Amount Amount Formula

Formula Formula Amount Formula

153010870.xlsx.ms_office, Exercise 5-11, Page 8 of 18, 6/20/2013, 6:59 AM

Solution Name: Date: Instructor: Course: th Intermediate Accounting, 14 Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
P5-2 (Balance Sheet Presentation) Presented below are a number of balance sheet items for Montoya, Inc., for the current year, 2012. Goodwill Payroll Taxes Payable Bonds Payable Discount on Bonds Payable Cash Land Notes Receivable Notes Payable to Banks Accounts Payable Retained Earnings Income Taxes Receivable Unsecured Notes Payable (Long-term) $125,000 177,591 300,000 15,000 360,000 480,000 445,700 265,000 490,000 ? 97,630 1,600,000 Accumulated Depreciation - Equipment Inventory Rent Payable - Short-term Income Tax Payable Rental Payable Long-term Common Stock, $1 Par Value Preferred Stock, $10 Par Value Prepaid Expenses Equipment Equity Investments (Trading) Accumulated Depreciation - Buildings Buildings $292,000 239,800 45,000 98,362 480,000 200,000 150,000 87,920 1,470,000 121,000 270,200 1,640,000

Instructions: Prepare a classified balance sheet in good form. Common stock authorized was 400,000 shares, and preferred stock authorized was 20,000 shares. Assume that notes receivable and notes payable are short-term, unless stated otherwise. Cost and fair value of marketable securities are the same. MONTOYA, INC. Balance Sheet December 31, 2012 Assets Current assets Cash Equity Investments (Trading) Notes Receivable Income Taxes Receivable Inventory Prepaid Expenses Total current assets Property, plant, and equipment Land Buildings Less: Accum Deprec - Buildings Equipment Less: Accum Deprec - Equipment Intangible assets Goodwill Total assets $360,000 121,000 445,700 97,630 239,800 87,920 $1,352,050

480,000 $1,640,000 270,200 1,470,000 292,000 1,369,800 1,178,000 3,027,800 125,000 $4,504,850

153010870.xlsx.ms_office, Problem 5-2 Solution, Page 9 of 18, 6/20/2013, 6:59 AM

Solution Name: Date: Instructor: Course: th Liabilities Shareholders Equity Intermediate Accounting, 14 Edition by Kieso,and Weygandt, and Warfield
Current liabilities Accounts Payable Notes Payable to Banks Payroll Taxes Payable Income Tax Payable Rent Payable - Short-term Total current liabilities Long-term liabilities Unsecured Notes Payable (Long-term) Bonds Payable Less: Discount on Bonds Payable Rental Payable Long-term Total liabilities $490,000 265,000 177,591 98,362 45,000 $1,075,953

1,600,000 $300,000 15,000 285,000 480,000

2,365,000 3,440,953

Shareholders equity Capital Stock Preferred stock, $10 par; 20,000 shares authorized, 15,000 shares issued 150,000 Common stock, $1 par; 400,000 shares authorized, 200,000 issued 200,000 Retained Earnings ($1,063,897 - $350,000) Total shareholders equity ($4,504,850 $3,440,953) Total liabilities and shareholders equity Computation of Retained earnings: Accounting Equation Total assets Less: Liabilities Less: Contributed capital Retained earnings

350,000 713,897 1,063,897 $4,504,850

$4,504,850 3,440,953 350,000 $713,897

153010870.xlsx.ms_office, Problem 5-2 Solution, Page 10 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: th Intermediate Accounting, 14 Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
P5-2 (Balance Sheet Presentation) Presented below are a number of balance sheet items for Montoya, Inc., for the current year, 2012. Goodwill Payroll Taxes Payable Bonds Payable Discount on Bonds Payable Cash Land Notes Receivable Notes Payable to Banks Accounts Payable Retained Earnings Income Taxes Receivable Unsecured Notes Payable (Long-term) $125,000 177,591 300,000 15,000 360,000 480,000 445,700 265,000 490,000 ? 97,630 1,600,000 Accumulated Depreciation - Equipment Inventory Rent Payable - Short-term Income Tax Payable Rental Expense Long-term Common Stock, $1 Par Value Preferred Stock, $10 Par Value Prepaid Expenses Equipment Equity Investments (Trading) Accumulated Depreciation - Buildings Buildings $292,000 239,800 45,000 98,362 480,000 200,000 150,000 87,920 1,470,000 121,000 270,200 1,640,000

Instructions: Prepare a classified balance sheet in good form. Common stock authorized was 400,000 shares, and preferred stock authorized was 20,000 shares. Assume that notes receivable and notes payable are short-term, unless stated otherwise. Cost and fair value of marketable securities are the same. MONTOYA, INC. Balance Sheet December 31, 2012 Assets Current assets Account Title Account Title Account Title Account Title Account Title Account Title Total current assets Property, plant, and equipment Account Title Account Title Account Title Account Title Account Title Intangible assets Account Title Total assets Amount Amount Amount Amount Amount Amount Formula

Amount Amount Amount Amount Amount Formula Formula Formula Amount Formula

153010870.xlsx.ms_office, Problem 5-2, Page 11 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: th Liabilities Shareholders Equity Intermediate Accounting, 14 Edition by Kieso,and Weygandt, and Warfield
Current liabilities Account Title Account Title Account Title Account Title Account Title Total current liabilities Long-term liabilities Account Title Account Title Account Title Account Title Total liabilities Shareholders equity Account Title Account Title with details Amount Account Title with details Amount Account title Title Total liabilities and shareholders equity Computation of Retained earnings: Accounting Equation Title Title Title Title Formula Amount Formula Formula Amount Amount Amount Amount Amount Formula

Amount Amount Amount Formula Amount

Formula Formula

Amount Amount Amount Formula

153010870.xlsx.ms_office, Problem 5-2, Page 12 of 18, 6/20/2013, 6:59 AM

Solution Name: Date: Instructor: Course: th Intermediate Accounting, 14 Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
P5-6 (Preparation of a Statement of Cash Flows and a Balance Sheet) Lansbury Inc. had the balance sheet shown on the following page at December 31, 2011. LANSBURY INC. Balance Sheet December 31, 2011 $20,000 Accounts Payable 21,200 Notes Payable (Long-term) 32,000 Common Stock 81,000 Retained Earnings 40,000 $194,200

Cash Accounts Receivable Investments Plant Assets (Net) Land

$30,000 41,000 100,000 23,200 $194,200

During 2012 the following occurred: 1. Lansbury Inc. sold part of its investment portfolio for $15,000 This transaction resulted in a gain of $3,400 for the firm. The company classifies its investments as available-forsale. 2. A tract of land was purchased for $18,000 cash. 3. Long-term notes payable in the amount of $16,000 were retired before maturity by paying $16,000 cash. 4. An additional $20,000 in common stock was issued at par. 5. Dividends totaling $8,200 were declared and paid to stockholders. 6. Net income for 2012 was $32,000 after allowing for depreciation of $11,000 7. Land was purchased through the issuance of $30,000 in bonds. 8. At December 31, 2012, Cash was $32,000 Accounts Receivable was $41,600 and Accounts Payable remained at $30,000 Instructions: (a) Prepare a statement of cash flows for 2012. LANSBURY INC. Statement of Cash Flows For the Year Ended December 31, 2012 Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating $11,000 Depreciation Expense (3,400) Gain on sale of investments Increase in account receivable ($41,600 $21,200) (20,400) Net cash provided by operating activities Cash flows from investing activities Sale of investments Purchase of land Net cash used in investing

$32,000

(12,800) 19,200

15,000 (18,000) (3,000)

153010870.xlsx.ms_office, Problem 5-6 Solution, Page 13 of 18, 6/20/2013, 6:59 AM

Solution Name: Date: Instructor: Course: th Cash flows from financing Intermediate Accounting , 14 Editionactivities by Kieso, Weygandt, and Warfield
Issuance of common stock Retirement of notes payable Payment of cash dividends Net cash used by financing activities Net increase in cash Cash at beginning of year Cash at end of year Noncash investing and financing activities Land purchased through issuance of $30,000 of bonds (b) Prepare an unclassified balance sheet as it would appear at December 31, 2012. LANSBURY INC. Balance Sheet December 31, 2012 Assets Cash Accounts Receivable Investments Plant Assets (Net) Land Total assets (1) (2) (3) (4) (5) (6) (7) $32,000 41,600 20,400 70,000 88,000 $252,000 Liabilities and Shareholders Equity Accounts Payable $30,000 Notes Payable (Long-term) 25,000 Bonds Payable 30,000 Common Stock 120,000 Retained Earnings 47,000 Total Liabilities and SHE $252,000 20,000 (16,000) (8,200) (4,200) 12,000 20,000 $32,000

(1) (2) (3)

(4) (5) (6) (7)

Investments - $32,000 - ($15,000 - $3,400 = $20,400 Plant assets - $81,000 - $11,000 = $70,000 Land - $40,000 + ($18,000 + $30,000 = $88,000 Notes payable - Long-term - $41,000 - ($16,000 = $25,000 Bonds payable - $0 + $30,000 = $30,000 Common stock - $100,000+ $20,000 = $120,000 Retained earnings - $23,200 + ($32,000 - $8,200 = $47,000

(c) How might the statement of cash flows help the user of the financial statements? Compute two cash flow ratios. Cash flow information is useful for assessing the amount, timing, and uncertainty of future cash flows. For example, by showing the specific inflows and outflows from operating activities, investing activities, and financing activities, the user has a better understanding of the liquidity and financial flexibility of the enterprise. Similarly, these reports are useful in providing feedback about the flow of enterprise resources. This information should help users make more accurate predictions of future cash flow. In addition, some individuals have expressed concern about the quality of the earnings because the measurement of the income depends on a number of accruals and estimates which may be somewhat subjective. As a result, the higher the ratio of cash provided by operating activities to net income, the more comfort some users have in the reliability of the earnings. In this problem the ratio of cash provided by operating activities to net income is 60% ($19,200 $32,000).

153010870.xlsx.ms_office, Problem 5-6 Solution, Page 14 of 18, 6/20/2013, 6:59 AM

Solution Name: Date: Instructor: Course: th An analysis of Lansburys free cash indicates it is negative as and shown below: Intermediate Accounting , 14 flow Edition by Kieso, Weygandt, Warfield
Free Cash Flow Analysis Net cash provided by operating activities Less: Purchase of land Dividends Free cash flow $19,200 ($18,000) ($8,200) ($7,000)

Its current cash debt coverage ratio is 0.64 to 1 ($19,200 / $30,000). Cash debt coverage ratio is 0.25 to 1 {$19,200 / [($71,000 + $85,000) / 2]}, which is reasonable. Overall, it appears that its liquidity position is average and overall financial flexibility and solvency should be improved.

153010870.xlsx.ms_office, Problem 5-6 Solution, Page 15 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: th Intermediate Accounting, 14 Edition by Kieso, Weygandt, and Warfield Primer on Using Excel in Accounting by Rex A Schildhouse
P5-6 (Preparation of a Statement of Cash Flows and a Balance Sheet) Lansbury Inc. had the balance sheet shown on the following page at December 31, 2011. LANSBURY INC. Balance Sheet December 31, 2011 $20,000 Accounts Payable 21,200 Notes Payable (Long-term) 32,000 Common Stock 81,000 Retained Earnings 40,000 $194,200

Cash Accounts Receivable Investments Plant Assets (Net) Land

$30,000 41,000 100,000 23,200 $194,200

During 2012 the following occurred: 1. Lansbury Inc. sold part of its investment portfolio for $15,000 This transaction resulted in a gain of $3,400 for the firm. The company classifies its investments as available-forsale. 2. A tract of land was purchased for $18,000 cash. 3. Long-term notes payable in the amount of $16,000 were retired before maturity by paying $16,000 cash. 4. An additional $20,000 in common stock was issued at par. 5. Dividends totaling $8,200 were declared and paid to stockholders. 6. Net income for 2012 was $32,000 after allowing for depreciation of $11,000 7. Land was purchased through the issuance of $30,000 in bonds. 8. At December 31, 2012, Cash was $32,000 Accounts Receivable was $41,600 and Accounts Payable remained at $30,000 Instructions: (a) Prepare a statement of cash flows for 2012. LANSBURY INC. Statement of Cash Flows For the Year Ended December 31, 2012 Cash flows from operating activities Title Account Title Account Title Account Title Account Title Net cash provided by operating activities Cash flows from investing activities Account Title Account Title Net cash used in investing Amount Amount Amount Formula Formula

Amount

Amount Amount Formula

153010870.xlsx.ms_office, Problem 5-6, Page 16 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: th Cash flows from financing Intermediate Accounting , 14 Editionactivities by Kieso, Weygandt, and Warfield
Account Title Account Title Account Title Net cash used by financing activities Net increase in cash Cash at beginning of year Cash at end of year Enter text as appropriate Enter text as appropriate (b) Prepare an unclassified balance sheet as it would appear at December 31, 2012. LANSBURY INC. Balance Sheet December 31, 2012 Assets Account Title Account Title Account Title Account Title Account Title Total assets (1) (2) (3) (4) (5) (6) (7) Amount Amount Amount Amount Amount Formula Liabilities and Stockholders Equity Account Title Amount Account Title Amount Account Title Amount Account Title Amount Account Title Amount Total Liabilities and SHE Formula Amount Amount Amount Formula Formula Amount Formula

(1) (2) (3)

(4) (5) (6) (7)

Formula or calculation area as desired. Formula or calculation area as desired. Formula or calculation area as desired. Formula or calculation area as desired. Formula or calculation area as desired. Formula or calculation area as desired. Formula or calculation area as desired.

(c) How might the statement of cash flows help the user of the financial statements? Compute two cash flow ratios. Enter text answer here

153010870.xlsx.ms_office, Problem 5-6, Page 17 of 18, 6/20/2013, 6:59 AM

Name: Date: Instructor: Course: th An analysis of Lansburys free cash indicates it is negative as and shown below: Intermediate Accounting , 14 flow Edition by Kieso, Weygandt, Warfield
Free Cash Flow Analysis Net cash provided by operating activities Less: Purchase of land Dividends Free cash flow Enter first ratio here Enter second ratio here Comments as desired Amount Amount Amount Formula

153010870.xlsx.ms_office, Problem 5-6, Page 18 of 18, 6/20/2013, 6:59 AM