Assignment Task: Cash Flow Statement
The following information relates to Blackwolf Ltd.:
Blackwolf Ltd. Comparative Balance Sheet As At 30 June 2010 and 2009
|
|
2010 $
|
2009 $
|
|
Cash
|
25,000
|
19,000
|
|
Account receivable
|
176,000
|
82,000
|
|
Inventory
|
117,000
|
64,000
|
|
Buildings
|
31,000
|
51,000
|
|
Acc. depreciation - buildings
|
-15,000
|
-15,000
|
|
Equipment
|
30,000
|
55,000
|
|
Acc. depreciation - equipment
|
-5,000
|
-16,000
|
|
Total assets
|
359,000
|
240,000
|
|
|
|
|
|
Accounts payable
|
107,000
|
62,000
|
|
Accrued expenses
|
5,000
|
6,000
|
|
Interest payable
|
5,000
|
2,000
|
|
Income tax payable
|
10,000
|
4,000
|
|
Short-term loan
|
3,000
|
5,000
|
|
Share capital
|
98,000
|
88,000
|
|
Retained profit
|
131,000
|
73,000
|
|
Total liabilities & shareholders' equity
|
359,000
|
240,000
|
Additional information during the year:
ALL sales and expenses are on credit.
A building with original cost of $20,000 and accumulated depreciation of $5,000 was saold cash for a price of $20,000.
A piece of equipment with an original cost of $25,000 and accumulated depreciation of $15,000 was sold cash for a price of $5,000.
Blackwolf Ltd had a net profit of $67,000 this year.
Required:
Question 1: Using the indirect method, prepare the reconciliation of Net Profit for Cash flows from Operations.
Question 2: Indicate which Blackwolf's stage of life-cycle and what evidence you use to support this selection.
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