Cash   $41,900   $34,100 Accounts Receivable   70,400   60,300 Inventory   29,900   24,000 Equity investments   22,100   38,300 Machinery   30,200   18,900 Buildings   67,900   56,800 Land   7,400   7,400     $269,800   $239,800           Credit Accounts         Allowance for Doubtful Accounts   $2,200   $1,500 Accumulated Depreciation—Machinery   5,600   2,200 Accumulated Depreciation—Buildings   13,400   8,900 Accounts Payable   35,300   24,700 Accrued Payables   3,400   2,600 Long-Term Notes Payable   21,000   30,800 Common Stock, no-par   150,000   125,000 Retained Earnings   38,900   44,100     $269,800   $239,800   Additional data (ignoring taxes): 1.   Net income for the year was $40,900. 2.   Cash dividends declared and paid during the year were $21,100. 3.   A 20% stock dividend was declared during the year. $25,000 of retained earnings was capitalized. 4.   Equity investments (level of ownership is less than 20%) that cost $25,200 were sold during the year for $29,000. No unrealized gains and losses were recorded on these investments in 2017. 5.   Machinery that cost $3,700, on which $750 of depreciation had accumulated, was sold for $2,150. Sweet’s 2017 income statement follows (ignoring taxes). Sales revenue         $538,000 Less: Cost of goods sold         380,200 Gross margin         157,800 Less: Operating expenses (includes $8,650 depreciation and $5,364 bad debts)         119,900 Income from operations         37,900 Other: Gain on sale of investments   $3,800                 Loss on sale of machinery   (800 )   3,000 Net income         $40,900  Prepare a statement of cash flows using the indirect method

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
icon
Concept explainers
Topic Video
Question
100%
Cash  
$41,900
 
$34,100
Accounts Receivable  
70,400
 
60,300
Inventory  
29,900
 
24,000
Equity investments  
22,100
 
38,300
Machinery  
30,200
 
18,900
Buildings  
67,900
 
56,800
Land  
7,400
 
7,400
   
$269,800
 
$239,800
         
Credit Accounts        
Allowance for Doubtful Accounts  
$2,200
 
$1,500
Accumulated Depreciation—Machinery  
5,600
 
2,200
Accumulated Depreciation—Buildings  
13,400
 
8,900
Accounts Payable  
35,300
 
24,700
Accrued Payables  
3,400
 
2,600
Long-Term Notes Payable  
21,000
 
30,800
Common Stock, no-par  
150,000
 
125,000
Retained Earnings  
38,900
 
44,100
   
$269,800
 
$239,800

 


Additional data (ignoring taxes):

1.   Net income for the year was $40,900.
2.   Cash dividends declared and paid during the year were $21,100.
3.   A 20% stock dividend was declared during the year. $25,000 of retained earnings was capitalized.
4.   Equity investments (level of ownership is less than 20%) that cost $25,200 were sold during the year for $29,000. No unrealized gains and losses were recorded on these investments in 2017.
5.   Machinery that cost $3,700, on which $750 of depreciation had accumulated, was sold for $2,150.


Sweet’s 2017 income statement follows (ignoring taxes).

Sales revenue        
$538,000
Less: Cost of goods sold        
380,200
Gross margin        
157,800
Less: Operating expenses (includes $8,650 depreciation and $5,364 bad debts)        
119,900
Income from operations        
37,900
Other: Gain on sale of investments  
$3,800
     
          Loss on sale of machinery  
(800
)
 
3,000
Net income        
$40,900

 Prepare a statement of cash flows using the indirect method

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps with 4 images

Blurred answer
Knowledge Booster
Financial Statements
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education