Comparative Balance Sheet as at DEcember 31 2014 and 2013 2014 2013 Increase/(Decrease) Assets Cash 238,000 138,000 ? Accounts Receivable 325,000 300,000 ? Inventories 280,000 350,000 ? Prepaid expenses 28,000 35,000 ? Intangible assets 328,000 328,000 ? Plant assets, net 1,200,000 980,000 ? Total Assets 2,399,000 2,131,000 Liabilities Accounts payable 180,000 240,000 ? Accrued liabilities 310,000 415,000 ? Income tax payable 105,000 100,000 ? Long-term notes payable 1,350,000 800,000 ? Stockholders' Equity Common Stock 330,000 295,000 ? Retained earnings 450,000 345,500 ? Treasury stock (326,000) (64,500) ? Total liabilities and stockholders' equity 2,399,000 2,131,000 Income Statement for the year ended 2014 Revenues and gains: Sales revenue 2,450,000 Gain on sale of plant assets 103,200 Total revenues and gains 2,553,200 Expenses Cost of goods sold 945,000 Depreciation expense 185,000 Other operating expense 398,500 Total expenses 1,528,500 Income before income taxes 1,024,700 Income tax expense 245,000 Net Income 779,700 Notes Acquisition of plant asset during 2014 610,000 Sale proceed from sale of plant asset 308,200 Receipt for issuance of notes payable 870,000 Payment for note payable 320,000 Dividend paid 675,200 Book value of equipment sold 205,000 Required 1. Reconstruct the company’s comparative balance sheet for 2013/2014 show the missing figures to include the appropriate sign as a positive or negative figure. (showing Working) 2. Which category of the statement of cash flow is considered as the most important? Why? 3. Prepare a complete statement of cash flows for 2014 using the indirect method 9Shwoing Working)

Comparative Balance Sheet as at DEcember 31 2014 and 2013 2014 2013 Increase/(Decrease) Assets Cash 238,000 138,000 ? Accounts Receivable 325,000 300,000 ? Inventories 280,000 350,000 ? Prepaid expenses 28,000 35,000 ? Intangible assets 328,000 328,000 ? Plant assets, net 1,200,000 980,000 ? Total Assets 2,399,000 2,131,000 Liabilities Accounts payable 180,000 240,000 ? Accrued liabilities 310,000 415,000 ? Income tax payable 105,000 100,000 ? Long-term notes payable 1,350,000 800,000 ? Stockholders' Equity Common Stock 330,000 295,000 ? Retained earnings 450,000 345,500 ? Treasury stock (326,000) (64,500) ? Total liabilities and stockholders' equity 2,399,000 2,131,000 Income Statement for the year ended 2014 Revenues and gains: Sales revenue 2,450,000 Gain on sale of plant assets 103,200 Total revenues and gains 2,553,200 Expenses Cost of goods sold 945,000 Depreciation expense 185,000 Other operating expense 398,500 Total expenses 1,528,500 Income before income taxes 1,024,700 Income tax expense 245,000 Net Income 779,700 Notes Acquisition of plant asset during 2014 610,000 Sale proceed from sale of plant asset 308,200 Receipt for issuance of notes payable 870,000 Payment for note payable 320,000 Dividend paid 675,200 Book value of equipment sold 205,000 Required 1. Reconstruct the company’s comparative balance sheet for 2013/2014 show the missing figures to include the appropriate sign as a positive or negative figure. (showing Working) 2. Which category of the statement of cash flow is considered as the most important? Why? 3. Prepare a complete statement of cash flows for 2014 using the indirect method 9Shwoing Working)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Comparative Balance Sheet as at DEcember 31 2014 and 2013

	2014	2013	Increase/(Decrease)
Assets
Cash	238,000	138,000	?
Accounts Receivable	325,000	300,000	?
Inventories	280,000	350,000	?
Prepaid expenses	28,000	35,000	?
Intangible assets	328,000	328,000	?
Plant assets, net	1,200,000	980,000	?
Total Assets	2,399,000	2,131,000
Liabilities
Accounts payable	180,000	240,000	?
Accrued liabilities	310,000	415,000	?
Income tax payable	105,000	100,000	?
Long-term notes payable	1,350,000	800,000	?
Stockholders' Equity
Common Stock	330,000	295,000	?
Retained earnings	450,000	345,500	?
Treasury stock	(326,000)	(64,500)	?
Total liabilities and stockholders' equity	2,399,000	2,131,000

Income Statement for the year ended 2014

Revenues and gains:
Sales revenue	2,450,000
Gain on sale of plant assets	103,200
Total revenues and gains		2,553,200
Expenses
Cost of goods sold	945,000
Depreciation expense	185,000
Other operating expense	398,500
Total expenses		1,528,500
Income before income taxes		1,024,700
Income tax expense		245,000
Net Income		779,700

Notes
Acquisition of plant asset during 2014		610,000
Sale proceed from sale of plant asset		308,200
Receipt for issuance of notes payable		870,000
Payment for note payable		320,000
Dividend paid		675,200
Book value of equipment sold		205,000

Required

1. Reconstruct the company’s comparative balance sheet for 2013/2014 show the missing figures to include the appropriate sign as a positive or negative figure. (showing Working)

2. Which category of the statement of cash flow is considered as the most important? Why?

3. Prepare a complete statement of cash flows for 2014 using the indirect method 9Shwoing Working)

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