Comparative Balance Sheet December 31 2020 2019 Assets Cash $44,000 $28,000 Accounts receivable A 32,000 Inventories B 70,000 Prepaid rent 2,500 2,000 Property, plant, and equipment 224,000 200,000 Accumulated depreciation (55,000) (40,000) Total assets $341,500 $292,000 Liabilities and Shareholders’ Equity Accounts payable $38,000 $34,000 Accrued liabilities 10,000 12,000 Notes payable 130,000 150,0 Contributed capital 50,000 25,000 Retained earnings 113,500 71,000 Total liabilities and shareholders’ equity $341,500 $292,000 Income Statement Year Ended December 31, 2020 Sales $477,500 Expenses Cost of goods sold $290,000 Selling, general, and administrative expenses 94,000 Depreciation expense C Interest expense 9,000 Income taxes D 425,000 Net income $52,500 Cash Flow Statement – Year End December 31, 2020 Cash flows from operating activities Net income $52,500 Adjustments: Depreciation expense 15,000 Change in inventories (20,000) Change in prepaid expenses E Change in accounts payable 4,000 Change in accrued liabilities F Change in accounts receivable (4,000) Net cash provided by operating activities G Cash flows from investing activities Purchase of property, plant, and equipment (24,000) Net cash provided by (used for) investing activities (24,000) Financing activities Additional capital contributed by shareholders H Payment of principal on notes (20,000) Payment of cash dividends I Net cash provided by (used for) financing activities J Increase in cash and cash equivalents 16,000 Cash and cash equivalents, January 1 28,000 Cash and cash equivalents, December 31 $44,000 Additional information: A cash dividend was declared and paid in full during the year. Instructions: Solve for the missing numbers and summarize your answers in the table. Be sure to indicate in parenthesis () if the missing number is negative (that is, a cash outflow).
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2020 |
2019 |
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Assets |
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Cash |
$44,000 |
$28,000 |
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A |
32,000 |
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Inventories |
B |
70,000 |
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Prepaid rent |
2,500 |
2,000 |
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Property, plant, and equipment |
224,000 |
200,000 |
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(55,000) |
(40,000) |
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Total assets |
$341,500 |
$292,000 |
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Liabilities and Shareholders’ Equity |
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Accounts payable |
$38,000 |
$34,000 |
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Accrued liabilities |
10,000 |
12,000 |
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Notes payable |
130,000 |
150,0 |
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Contributed capital |
50,000 |
25,000 |
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113,500 |
71,000 |
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Total liabilities and shareholders’ equity |
$341,500 |
$292,000 |
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Income Statement |
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Sales |
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$477,500 |
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Expenses |
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Cost of goods sold |
$290,000 |
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Selling, general, and administrative expenses |
94,000 |
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Depreciation expense |
C |
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Interest expense |
9,000 |
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Income taxes |
D |
425,000 |
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Net income |
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$52,500 |
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Cash Flow Statement – Year End December 31, 2020 |
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Net income |
$52,500 |
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Adjustments: |
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Depreciation expense |
15,000 |
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Change in inventories |
(20,000) |
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Change in prepaid expenses |
E |
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Change in accounts payable |
4,000 |
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Change in accrued liabilities |
F |
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Change in accounts receivable |
(4,000) |
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Net cash provided by operating activities |
G |
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Cash flows from investing activities |
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Purchase of property, plant, and equipment |
(24,000) |
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Net cash provided by (used for) investing activities |
(24,000) |
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Financing activities |
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Additional capital contributed by shareholders |
H |
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Payment of principal on notes |
(20,000) |
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Payment of cash dividends |
I |
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Net cash provided by (used for) financing activities |
J |
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Increase in cash and cash equivalents |
16,000 |
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Cash and cash equivalents, January 1 |
28,000 |
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Cash and cash equivalents, December 31 |
$44,000 |
Additional information: A cash dividend was declared and paid in full during the year.
Instructions: Solve for the missing numbers and summarize your answers in the table. Be sure to indicate in parenthesis () if the missing number is negative (that is, a
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