Condensed financial data of Larkspur, Inc. follow. Larkspur, Inc. Comparative Balance Sheets December 31 Assets 2022 2021 Cash $105,900 $47,000 Accounts receivable 92,700 33,100 Inventory 112,800 101,000 Prepaid expenses 29,200 25,500 Long-term investments 139,400 114,200 Plant assets 274,500 241,400 Accumulated depreciation (46,800 ) (52,400 ) Total $707,700 $509,800 Liabilities and Stockholders’ Equity Accounts payable $111,900 $67,800 Accrued expenses payable 16,000 17,300 Bonds payable 117,200 149,500 Common stock 219,100 175,300 Retained earnings 243,500 99,900 Total $707,700 $509,800 Larkspur, Inc. Income Statement For the Year Ended December 31, 2022 Sales revenue $392,600 Less: Cost of goods sold $136,000 Operating expenses, excluding depreciation 11,700 Depreciation expense 32,300 Income tax expense 27,600 Interest expense 4,000 Loss on disposal of plant assets 7,500 219,100 Net income $173,500 Additional information: 1. New plant assets costing $81,000 were purchased for cash during the year. 2. Old plant assets having an original cost of $47,900 and accumulated depreciation of $37,900 were sold for $2,500 cash. 3. Bonds payable matured and were paid off at face value for cash. 4. A cash dividend of $29,900 was declared and paid during the year. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

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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Condensed financial data of Larkspur, Inc. follow.

Larkspur, Inc. Comparative Balance Sheets December 31
Assets	2022		2021
Cash	$105,900			$47,000
Accounts receivable	92,700			33,100
Inventory	112,800			101,000
Prepaid expenses	29,200			25,500
Long-term investments	139,400			114,200
Plant assets	274,500			241,400
Accumulated depreciation	(46,800	)		(52,400	)
Total	$707,700			$509,800

Liabilities and Stockholders’ Equity
Accounts payable	$111,900			$67,800
Accrued expenses payable	16,000			17,300
Bonds payable	117,200			149,500
Common stock	219,100			175,300
Retained earnings	243,500			99,900
Total	$707,700			$509,800

Larkspur, Inc. Income Statement For the Year Ended December 31, 2022
Sales revenue		$392,600
Less:
Cost of goods sold	$136,000
Operating expenses, excluding depreciation	11,700
Depreciation expense	32,300
Income tax expense	27,600
Interest expense	4,000
Loss on disposal of plant assets	7,500	219,100
Net income		$173,500

Additional information:

1.		New plant assets costing $81,000 were purchased for cash during the year.
2.		Old plant assets having an original cost of $47,900 and accumulated depreciation of $37,900 were sold for $2,500 cash.
3.		Bonds payable matured and were paid off at face value for cash.
4.		A cash dividend of $29,900 was declared and paid during the year.

Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

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