Use the Following Selected Data and Additional Information from the Records

question 225

Essay

Use the following selected data and additional information from the records of Utah Corp. to answer the questions that follow.
1 Equipment with a cost of $15,000 and a book value of $3,000 was sold for $5,000 during 2016.
2 Common stock was issued to retire bonds payable during 2016.
3 The only items affecting retained earnings in 2016 were net income and dividends declared and paid.
-Review the data for Utah Corp.
REQUIRED:
Prepare the operating activities section of statement of cash flows for Utah Corp. for 2016 if the direct method is used to determine net cash flow from operating activities.

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Definitions:

Stock Split

A corporate action in which a company divides its existing shares into multiple shares to boost the liquidity of the shares, although the overall value of one's holdings remains the same.

Shareholder's Wealth

The overall value that shareholders earn from their investment in a company, including dividends received and capital gains from share price appreciation.

Stock Split

A corporate action that increases the number of shares outstanding by issuing more shares to current shareholders, affecting share price.

Market Value

The existing cost at which a commodity or service is available for buying or selling in the market.