Dec. 31, 20Y8 Dec. 31, 20Y7 Assets $ 110,000 280,000 450,000 Cash ... $ 95,000 ..... Accounts recelvable (net) 260,000 Inventorles ... 520,000 Prepald expenses Equlpment....... Accumulated depreclation-equlpment. Total assets . 15,000 5,000 1,130,000 800,000 (235,000) $1,785,000 (190,000) $1,455,000 Liabilities and Stockholders' Equity $ 100,000 $ 75,000 500,000 Accounts payable (merchandise creditors) .. Mortgage note payable...... Common stock, $10 par... Pald-In capital in excess of par-common stock. Retalned earnings..... Total llabilitles and stockholders' equity.. .. 500,000 200,000 100,000 580,000 400,000 785,000 $1,785,000 $1,455,000 ...... ....
Statement of
The comparative
December 31, 20Y8 and 20Y7, is as follows:
Additional data obtained from the income statement and from an
examination of the accounts in the ledger for 20Y8 are as follows:
a. Net income, $250,000.
b.
c. Equipment was purchased at a cost of $420,000 and fully
depreciated equipment costing $90,000 was discarded, with no salvage realized.
d. The mortgage note payable was not due for six years, but the
terms permitted earlier payment without penalty.
e. 30,000 shares of common stock were issued at $20 for cash.
f. Cash dividends declared and paid, $45,000.
Instructions
Prepare a statement of cash flows, using the indirect method of
presenting cash flows from operating activities.
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