Flint Inc., a greeting card company, had the following statements prepared as of December 31, 2020. FLINT INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 12/31/20 12/31/19 Cash $6,100 $6,900 Accounts receivable 61,900 50,500 Short-term debt investments (available-for-sale) 34,800 18,200 Inventory 39,900 59,800 Prepaid rent 4,900 4,000 Equipment 155,500 131,200 Accumulated depreciation—equipment (34,800 ) (25,300 ) Copyrights 45,700 50,200 Total assets $314,000 $295,500 Accounts payable $46,200 $39,700 Income taxes payable 4,000 6,100 Salaries and wages payable 7,900 4,000 Short-term loans payable 7,900 10,000 Long-term loans payable 59,800 68,600 Common stock, $10 par 100,000 100,000 Contributed capital, common stock 30,000 30,000 Retained earnings 58,200 37,100 Total liabilities & stockholders’ equity $314,000 $295,500 FLINT INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2020 Sales revenue $335,575 Cost of goods sold 173,200 Gross profit 162,375 Operating expenses 119,100 Operating income 43,275 Interest expense $11,400 Gain on sale of equipment 2,000 9,400 Income before tax 33,875 Income tax expense 6,775 Net income $27,100 Additional information: 1. Dividends in the amount of $6,000 were declared and paid during 2020. 2. Depreciation expense and amortization expense are included in operating expenses. 3. No unrealized gains or losses have occurred on the investments during the year. 4. Equipment that had a cost of $20,100 and was 70% depreciated was sold during 2020. 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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Exercise 23-14

Flint Inc., a greeting card company, had the following statements prepared as of December 31, 2020.

FLINT INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019
	12/31/20		12/31/19
Cash	$6,100			$6,900
Accounts receivable	61,900			50,500
Short-term debt investments (available-for-sale)	34,800			18,200
Inventory	39,900			59,800
Prepaid rent	4,900			4,000
Equipment	155,500			131,200
Accumulated depreciation—equipment	(34,800	)		(25,300	)
Copyrights	45,700			50,200
Total assets	$314,000			$295,500

Accounts payable	$46,200			$39,700
Income taxes payable	4,000			6,100
Salaries and wages payable	7,900			4,000
Short-term loans payable	7,900			10,000
Long-term loans payable	59,800			68,600
Common stock, $10 par	100,000			100,000
Contributed capital, common stock	30,000			30,000
Retained earnings	58,200			37,100
Total liabilities & stockholders’ equity	$314,000			$295,500

FLINT INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2020
Sales revenue		$335,575
Cost of goods sold		173,200
Gross profit		162,375
Operating expenses		119,100
Operating income		43,275
Interest expense	$11,400
Gain on sale of equipment	2,000	9,400
Income before tax		33,875
Income tax expense		6,775
Net income		$27,100

Additional information:

1.		Dividends in the amount of $6,000 were declared and paid during 2020.
2.		Depreciation expense and amortization expense are included in operating expenses.
3.		No unrealized gains or losses have occurred on the investments during the year.
4.		Equipment that had a cost of $20,100 and was 70% depreciated was sold during 2020.

Prepare a statement of cash flows using the indirect method.

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