Condensed financial data of Shamrock, Inc. follow. Shamrock, Inc. Comparative Balance Sheets December 31 Assets 2022 2021 Cash $ 242,400 $ 145,200 Accounts receivable 263,400 114,000 Inventory 337,500 308,550 Prepaid expenses 85,200 78,000 Long-term investments 414,000 327,000 Plant assets 855,000 727,500 Accumulated depreciation (150,000 ) (156,000 ) Total $2,047,500 $1,544,250 Liabilities and Stockholders’ Equity Accounts payable $ 306,000 $ 201,900 Accrued expenses payable 49,500 63,000 Bonds payable 330,000 438,000 Common stock 660,000 525,000 Retained earnings 702,000 316,350 Total $2,047,500 $1,544,250 Shamrock, Inc. Income Statement Data For the Year Ended December 31, 2022 Sales revenue $1,165,380 Less: Cost of goods sold $406,380 Operating expenses, excluding depreciation 37,230 Depreciation expense 139,500 Income tax expense 81,840 Interest expense 14,190 Loss on disposal of plant assets 22,500 701,640 Net income $ 463,740 Additional information: 1. New plant assets costing $300,000 were purchased for cash during the year. 2. Old plant assets having an original cost of $172,500 and accumulated depreciation of $145,500 were sold for $4,500 cash. 3. Bonds payable matured and were paid off at face value for cash. 4. A cash dividend of $78,090 was declared and paid during the year. 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

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Condensed financial data of Shamrock, Inc. follow.

Shamrock, Inc. Comparative Balance Sheets December 31
Assets	2022		2021
Cash	$ 242,400		$ 145,200
Accounts receivable	263,400		114,000
Inventory	337,500		308,550
Prepaid expenses	85,200		78,000
Long-term investments	414,000		327,000
Plant assets	855,000		727,500
Accumulated depreciation	(150,000	)	(156,000	)
Total	$2,047,500		$1,544,250

Liabilities and Stockholders’ Equity
Accounts payable	$ 306,000		$ 201,900
Accrued expenses payable	49,500		63,000
Bonds payable	330,000		438,000
Common stock	660,000		525,000
Retained earnings	702,000		316,350
Total	$2,047,500		$1,544,250

Shamrock, Inc. Income Statement Data For the Year Ended December 31, 2022
Sales revenue		$1,165,380
Less:
Cost of goods sold	$406,380
Operating expenses, excluding depreciation	37,230
Depreciation expense	139,500
Income tax expense	81,840
Interest expense	14,190
Loss on disposal of plant assets	22,500	701,640
Net income		$ 463,740

Additional information:

1.		New plant assets costing $300,000 were purchased for cash during the year.
2.		Old plant assets having an original cost of $172,500 and accumulated depreciation of $145,500 were sold for $4,500 cash.
3.		Bonds payable matured and were paid off at face value for cash.
4.		A cash dividend of $78,090 was declared and paid during the year.

Prepare a statement of cash flows using the indirect method.

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