Auga Company Ltd Comparative Balance Sheet December 31, 2021 and 2020 2021 2020 Increase/(Decrease) Assets Cash 110,000 70,000 ? Accounts Receivable 300,000 325,000 ? Supplies 350,000 280,000 ? Prepaid expenses 35,000 28,000 ? Intangible assets
Auga Company Ltd |
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Comparative Balance Sheet |
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December 31, 2021 and 2020 |
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2021 |
2020 |
Increase/(Decrease) |
Assets |
|
|
|
Cash |
110,000 |
70,000 |
? |
Accounts Receivable |
300,000 |
325,000 |
? |
Supplies |
350,000 |
280,000 |
? |
Prepaid expenses |
35,000 |
28,000 |
? |
Intangible assets |
215,000 |
215,000 |
? |
Equipment, net |
1,200,000 |
980,000 |
? |
Total Assets |
2,210,000 |
1,898,000 |
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Liabilities |
|
|
|
Accounts payable |
250,000 |
140,000 |
? |
Accrued liabilities |
210,000 |
215,000 |
? |
Income tax payable |
78,000 |
98,500 |
? |
Long-term notes payable |
602,000 |
725,000 |
? |
|
|
|
|
Common Stock |
410,000 |
330,000 |
? |
|
730,000 |
450,000 |
? |
|
(70,000) |
(60,500) |
? |
Total liabilities and stockholders' equity |
2,210,000 |
1,898,000 |
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Auga Company Ltd |
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Income Statement |
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Year Ended December 31,2021 |
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Revenues and gains: |
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Sales revenue |
2,100,000 |
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Gain on sale of Equipment |
85,000 |
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Total revenues and gains |
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2,185,000 |
Expenses |
|
|
Cost of goods sold |
900,000 |
|
|
150,000 |
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Other operating expense |
350,000 |
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Total expenses |
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1,400,000 |
Income before income taxes |
|
785,000 |
Income tax expense |
|
210,000 |
Net Income |
|
575,000 |
Notes |
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Acquisition of Equipment during 2021 |
540,000 |
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Sale proceeds from sale of Equipment |
255,000 |
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Receipt for issuance of notes payable |
27,000 |
|
Payment for note payable |
150,000 |
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Dividend paid |
295,000 |
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Book value of equipment sold |
170,000 |
Requirements
- Answer the following questions for the directors:
- True or false, the financing activities section of the statement of
cash flows reflects the cash flows that affect current assets and liabilities? - True or false, buying property, plant and equipment would be considered a
cash outflow from financing? - True or false, the financing section of the statement of cash flows reflects transactions in the equity accounts and the long-term liability accounts?
- True or false, suppose Auga Company Ltd just started business and was looking for additional capital in order to purchase a property to build their headquarters. If they found an investor who was willing to sell them land worth $500,000 in exchange for stock in the company, would this transaction be shown in the investing activities section of the statement of cash flows?
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