Accounting
CAS 11-2
Amerbran Company
Amerbran Company was a diversified company that sold various consumer products, including food, tobacco, distilled products, and personal care products and financial services. Financial statements for the company are shown in Exhibit 1.
The 20X1 financial statements reflect the following transactions (dollar amounts are in thousands):
1. Depreciation and amortization expense was $115,974.
2. Net income included a loss of $66,046 resulting from the write-off of some obsolete equipment. The equipment had not yet been disposed of.
3. Net income included $59,610 from Amerbran’s investment in a subsidiary; none of this income had been received in cash.
4. The year-end balance in Deferred Income Taxes was $17,548 lower than it was at the start of the year.
5. New property, plant, and equipment purchases totaled $260,075, all paid for with cash. Disposals of fixed assets generated $33,162 cash proceeds.
6. Acquisition of another company that was made for cash resulted in additional depreciable assets of $31,691 and goodwill of $102,030.
7. Cash dividends were paid in the amount of $216,158.
8. The firm declared and issued a 100 percent common stock dividend effective September 10, 20X1; that is, each shareholder received as a dividend a number of shares equal to his or her holdings prior to the dividend. The newly issued shares were valued at par in recording this transaction.
9. The firm spent $30,609 to purchase treasury stock on the open market. Some of the shares so acquired were reissued to certain employees as a bonus.
10. The firm increased its short-term debt as indicated on the balance sheet in Exhibit 1. Long-term borrowings decreased by $34,606.
Questions:
Prepare a statement of cash flows for the year 20X1. In order for your statement to show the correct increase in cash ($4,960), you will need to add a “miscellaneous activities” category; this will capture
Amerbran Company
Amerbran Company was a diversified company that sold various consumer products, including food, tobacco, distilled products, and personal care products and financial services. Financial statements for the company are shown in Exhibit 1.
The 20X1 financial statements reflect the following transactions (dollar amounts are in thousands):
1. Depreciation and amortization expense was $115,974.
2. Net income included a loss of $66,046 resulting from the write-off of some obsolete equipment. The equipment had not yet been disposed of.
3. Net income included $59,610 from Amerbran’s investment in a subsidiary; none of this income had been received in cash.
4. The year-end balance in Deferred Income Taxes was $17,548 lower than it was at the start of the year.
5. New property, plant, and equipment purchases totaled $260,075, all paid for with cash. Disposals of fixed assets generated $33,162 cash proceeds.
6. Acquisition of another company that was made for cash resulted in additional depreciable assets of $31,691 and goodwill of $102,030.
7. Cash dividends were paid in the amount of $216,158.
8. The firm declared and issued a 100 percent common stock dividend effective September 10, 20X1; that is, each shareholder received as a dividend a number of shares equal to his or her holdings prior to the dividend. The newly issued shares were valued at par in recording this transaction.
9. The firm spent $30,609 to purchase treasury stock on the open market. Some of the shares so acquired were reissued to certain employees as a bonus.
10. The firm increased its short-term debt as indicated on the balance sheet in Exhibit 1. Long-term borrowings decreased by $34,606.
Questions:
Prepare a statement of cash flows for the year 20X1. In order for your statement to show the correct increase in cash ($4,960), you will need to add a “miscellaneous activities” category; this will capture