Clayborne Company Reported the Following Changes in the Balance Sheet

question 104

Essay

Clayborne Company reported the following changes in the balance sheet accounts between Year 1 and Year 2.No dividends are paid during the year, land was sold at its book value of $30,000 and any change in the patent account is due to amortization.
Required:

Given the changes in the balance sheet for Year 2, state:
a. whether the change in each account indicates that an addition or subtraction needs to be made to determine cash flow, and
b. in what section of the statement of cash flows the adjustment would appear. Indicate if no adjustment is necessary.

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Definitions:

Intermediates

Reactive species that are formed during the chemical reactions and lie in the reaction pathway between the reactants and the final products.

Dimethylbut-1-ene

An organic compound that is a branched alkene with the formula C6H12, specifically one of the isomers with a double bond at the first carbon.

Major Alcohol

The primary alcohol product in higher concentration from a mixture or reaction process.

Mechanism

Describes the detailed steps of a chemical reaction, explaining how reactants are transformed into products at the molecular level.