E5-16B (L05,6) (Preparation of a Statement of Cash Flows) A comparative balance sheet for Gokhale Corporation is presented below. December 31 Assets 2017 2016 Cash $109,500 $ 33,000 Accounts receivable 123,000 270,000 106,500 390,000 (103,500) 99,000 283,500 165,000 300,000 (63,000) Inventories Land Equipment Accumulated depreciation-equipment Total $895,500 $817,500 Liabilities and Stockholders' Equity Accounts payable Bonds payable Common stock ($1 par) Retained earnings $ 51,000 225,000 321,000 298,500 $ 70,500 300,000 246,000 201,000 Total $895,500 $817,500 Additional information: 1. Net income for 2017 was $187,500. 2. Cash dividends of $90,000 were declared and paid. 3. Bonds payable amounting to $75,000 were retired through issuance of common stock. 4. Land was sold for cost. 5. Equipment was purchased but no equipment was sold.
E5-16B (L05,6) (Preparation of a Statement of Cash Flows) A comparative balance sheet for Gokhale Corporation is presented below. December 31 Assets 2017 2016 Cash $109,500 $ 33,000 Accounts receivable 123,000 270,000 106,500 390,000 (103,500) 99,000 283,500 165,000 300,000 (63,000) Inventories Land Equipment Accumulated depreciation-equipment Total $895,500 $817,500 Liabilities and Stockholders' Equity Accounts payable Bonds payable Common stock ($1 par) Retained earnings $ 51,000 225,000 321,000 298,500 $ 70,500 300,000 246,000 201,000 Total $895,500 $817,500 Additional information: 1. Net income for 2017 was $187,500. 2. Cash dividends of $90,000 were declared and paid. 3. Bonds payable amounting to $75,000 were retired through issuance of common stock. 4. Land was sold for cost. 5. Equipment was purchased but no equipment was sold.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:**E5-16B (L05,6) (Preparation of a Statement of Cash Flows)**
A comparative balance sheet for Gokhale Corporation is presented below.
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**Balance Sheet (December 31)**
| Assets | 2017 | 2016 |
|-----------------------------------------------|------------|------------|
| Cash | $109,500 | $33,000 |
| Accounts receivable | 123,000 | 99,000 |
| Inventories | 270,000 | 283,500 |
| Land | 106,500 | 165,000 |
| Equipment | 390,000 | 300,000 |
| Accumulated depreciation—equipment | (103,500) | (63,000) |
| **Total** | **$895,500**| **$817,500**|
| Liabilities and Stockholders’ Equity | 2017 | 2016 |
|-----------------------------------------------|------------|------------|
| Accounts payable | $51,000 | $70,500 |
| Bonds payable | 225,000 | 300,000 |
| Common stock ($1 par) | 321,000 | 246,000 |
| Retained earnings | 298,500 | 201,000 |
| **Total** | **$895,500**| **$817,500**|
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**Additional Information:**
1. Net income for 2017 was $187,500.
2. Cash dividends of $90,000 were declared and paid.
3. Bonds payable amounting to $75,000 were retired through issuance of common stock.
4. Land was sold for cost.
5. Equipment was purchased but no equipment was sold.
---
**Explanation:**
This document is a comparative balance sheet for Gokhale Corporation for the years ending December 31, 2016, and December 31, 2017. It details the company’s assets, liabilities, and stockholders' equity for each year. The total assets match the total liabilities and equity for both years, indicating a balanced accounting system.
The additional information provided offers insights into various financial transactions and events that took place during 2017, which are crucial for preparing a statement of cash flows.
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