Assets Dec 31, 2021 $117,000 24,000 DCIT. 202 $19,500 Cash Notes Receivable Supplies & Inventory 21,000 27,000 40,500 Prepaid expense 18,000 10,500 0 Long-term investments Machines and tools 27,000 55,500 48,000 (21.000) Accumulated depreciation equipment Total Assets (15.000) $213.000 $159.000 Liabilities & Stockholders' Equity Accounts payable $ 25,500 $ 10,500 55,500 70,500 Bonds payable (long-term) Common Stock 60,000 34,500 Retained Earnings 72.000 43.500 Total Liabilities & Stockholders' $213.000 $159.000 Equity Income Statement Information (2021): 1. Net income for the year ending December 31, 2021 is $43,500. 2. Depreciation expense is $6,000. 3. There is a loss of $3,000 resulted from the sale of long-term investment. Additional information (2021): 1. All sales and purchases of inventory are on account (or credit). 2. Received cash for the sale of long-term investments that had a cost of $27,000, yielding a $3,000 loss. 3. Cash dividends paid is $15,000. 4. The company purchased new machines and tools for $7,500 cash. Required: Prepare the FIRST (Operating) and the SECOND (Investing) sections of the statement of cash flows for the year ended December 31, 2021.
Assets Dec 31, 2021 $117,000 24,000 DCIT. 202 $19,500 Cash Notes Receivable Supplies & Inventory 21,000 27,000 40,500 Prepaid expense 18,000 10,500 0 Long-term investments Machines and tools 27,000 55,500 48,000 (21.000) Accumulated depreciation equipment Total Assets (15.000) $213.000 $159.000 Liabilities & Stockholders' Equity Accounts payable $ 25,500 $ 10,500 55,500 70,500 Bonds payable (long-term) Common Stock 60,000 34,500 Retained Earnings 72.000 43.500 Total Liabilities & Stockholders' $213.000 $159.000 Equity Income Statement Information (2021): 1. Net income for the year ending December 31, 2021 is $43,500. 2. Depreciation expense is $6,000. 3. There is a loss of $3,000 resulted from the sale of long-term investment. Additional information (2021): 1. All sales and purchases of inventory are on account (or credit). 2. Received cash for the sale of long-term investments that had a cost of $27,000, yielding a $3,000 loss. 3. Cash dividends paid is $15,000. 4. The company purchased new machines and tools for $7,500 cash. Required: Prepare the FIRST (Operating) and the SECOND (Investing) sections of the statement of cash flows for the year ended December 31, 2021.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
5
![The following comparative balance sheet is given for Estern Co.:
4
Assets
Dec 31, 2021
Dec.31.2020
Cash
$117,000
$19,500
Notes Receivable
24,000
21,000
Supplies & Inventory
27,000
40,500
Prepaid expense
10,500
18,000
Long-term investments
0
27,000
Machines and tools
55,500
48,000
(21.000)
(15.000)
Accumulated depreciation-equipment
Total Assets
$213.000
$159.000
Liabilities & Stockholders' Equity
Accounts payable
$ 25,500
$ 10,500
55,500
70,500
Bonds payable (long-term)
Common Stock
60,000
34,500
Retained Earnings
72.000
43.500
Total Liabilities & Stockholders'
$213.000
$159.000
Equity
Income Statement Information (2021):
1. Net income for the year ending December 31, 2021 is $43,500.
2. Depreciation expense is $6,000.
3. There is a loss of $3,000 resulted from the sale of long-term investment.
Additional information (2021):
1. All sales and purchases of inventory are on account (or credit)
2. Received cash for the sale of long-term investments that had a cost of $27,000, yielding a $3,000 loss.
3. Cash dividends paid is $15,000.
+ The company purchased new machines and tools for $7,500 cash.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdbfa5ca7-3095-46f6-ba3b-5fc637095942%2Fc033217a-7e92-48d9-9594-8ecd7c97fd0b%2Flwvhc2_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The following comparative balance sheet is given for Estern Co.:
4
Assets
Dec 31, 2021
Dec.31.2020
Cash
$117,000
$19,500
Notes Receivable
24,000
21,000
Supplies & Inventory
27,000
40,500
Prepaid expense
10,500
18,000
Long-term investments
0
27,000
Machines and tools
55,500
48,000
(21.000)
(15.000)
Accumulated depreciation-equipment
Total Assets
$213.000
$159.000
Liabilities & Stockholders' Equity
Accounts payable
$ 25,500
$ 10,500
55,500
70,500
Bonds payable (long-term)
Common Stock
60,000
34,500
Retained Earnings
72.000
43.500
Total Liabilities & Stockholders'
$213.000
$159.000
Equity
Income Statement Information (2021):
1. Net income for the year ending December 31, 2021 is $43,500.
2. Depreciation expense is $6,000.
3. There is a loss of $3,000 resulted from the sale of long-term investment.
Additional information (2021):
1. All sales and purchases of inventory are on account (or credit)
2. Received cash for the sale of long-term investments that had a cost of $27,000, yielding a $3,000 loss.
3. Cash dividends paid is $15,000.
+ The company purchased new machines and tools for $7,500 cash.
![Question Completion Status:
Assets
Dec 31, 2021
Dec 31, 2020
Cash
$117,000
$19,500
Notes Receivable
24,000
21,000
Supplies & Inventory
27,000
40,500
Prepaid expense
18,000
10,500
0
27,000
Long term investments
Machines and tools
55,500
48,000
(21.000)
(15.000)
Accumulated depreciation equipment
Total Assets
$213.000
$159.000
Liabilities & Stockholders' Equity
Accounts payable
$ 25,500
$ 10,500
Bonds payable (long-term)
55,500
70,500
Common Stock
60,000
34,500
Retained Earnings
72,000
43.500
Total Liabilities & Stockholders'
$213.000
$159.000
Equity
Income Statement Information (2021):
1. Net income for the year ending December 31, 2021 is $43,500,
2. Depreciation expense is $6,000.
3. There is a loss of $3,000 resulted from the sale of long-term investment.
Additional information (2021):
1. All sales and purchases of inventory are on account (or credit).
2. Received cash for the sale of long-term investments that had a cost of $27,000, yielding a $3,000 loss.
3. Cash dividends paid is $15,000.
4. The company purchased new machines and tools for $7,500 cash.
Required:
Prepare the FIRST (Operating) and the SECOND (Investing) sections of the statement of cash flows for the year ended December 31, 2021.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fdbfa5ca7-3095-46f6-ba3b-5fc637095942%2Fc033217a-7e92-48d9-9594-8ecd7c97fd0b%2Fdxy5ptc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Question Completion Status:
Assets
Dec 31, 2021
Dec 31, 2020
Cash
$117,000
$19,500
Notes Receivable
24,000
21,000
Supplies & Inventory
27,000
40,500
Prepaid expense
18,000
10,500
0
27,000
Long term investments
Machines and tools
55,500
48,000
(21.000)
(15.000)
Accumulated depreciation equipment
Total Assets
$213.000
$159.000
Liabilities & Stockholders' Equity
Accounts payable
$ 25,500
$ 10,500
Bonds payable (long-term)
55,500
70,500
Common Stock
60,000
34,500
Retained Earnings
72,000
43.500
Total Liabilities & Stockholders'
$213.000
$159.000
Equity
Income Statement Information (2021):
1. Net income for the year ending December 31, 2021 is $43,500,
2. Depreciation expense is $6,000.
3. There is a loss of $3,000 resulted from the sale of long-term investment.
Additional information (2021):
1. All sales and purchases of inventory are on account (or credit).
2. Received cash for the sale of long-term investments that had a cost of $27,000, yielding a $3,000 loss.
3. Cash dividends paid is $15,000.
4. The company purchased new machines and tools for $7,500 cash.
Required:
Prepare the FIRST (Operating) and the SECOND (Investing) sections of the statement of cash flows for the year ended December 31, 2021.
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