Condensed financial data of Whispering Company for 2020 and 2019 are presented below. WHISPERING COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 2020 2019 Cash $1,830 $1,130 Receivables 1,770 1,290 Inventory 1,620 1,920 Plant assets 1,940 1,680 Accumulated depreciation (1,190 ) (1,170 ) Long-term investments (held-to-maturity) 1,300 1,410 $7,270 $6,260 Accounts payable $1,220 $910 Accrued liabilities 210 260 Bonds payable 1,420 1,530 Common stock 1,890 1,710 Retained earnings 2,530 1,850 $7,270 $6,260 WHISPERING COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue $7,100 Cost of goods sold 4,760 Gross margin 2,340 Selling and administrative expenses 930 Income from operations 1,410 Other revenues and gains Gain on sale of investments 80 Income before tax 1,490 Income tax expense 550 Net income 940 Cash dividends 260 Income retained in business $680 Additional information: During the year, $80 of common stock was issued in exchange for plant assets. No plant assets were sold in 2020. Prepare a statement of cash flows using the direct method. (Show amounts in the investing and fina

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 Whispering Company for 2020 and 2019 are presented below.

WHISPERING COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019
	2020		2019
Cash	$1,830			$1,130
Receivables	1,770			1,290
Inventory	1,620			1,920
Plant assets	1,940			1,680
Accumulated depreciation	(1,190	)		(1,170	)
Long-term investments (held-to-maturity)	1,300			1,410
	$7,270			$6,260

Accounts payable	$1,220			$910
Accrued liabilities	210			260
Bonds payable	1,420			1,530
Common stock	1,890			1,710
Retained earnings	2,530			1,850
	$7,270			$6,260

WHISPERING COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020
Sales revenue		$7,100
Cost of goods sold		4,760
Gross margin		2,340
Selling and administrative expenses		930
Income from operations		1,410
Other revenues and gains
Gain on sale of investments		80
Income before tax		1,490
Income tax expense		550
Net income		940
Cash dividends		260
Income retained in business		$680

Additional information:

During the year, $80 of common stock was issued in exchange for plant assets. No plant assets were sold in 2020.

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

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