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Headland Corporation has contracted with you to prepare a statement of cash flows. The controller has provided the following information. Cash Accounts receivable Inventory Equity investments Buildings Equipment December 31 2025 $38.900 12.200 11.800 -0- 40,400 5.000 2024 $12.800 9.900 10,000 3.100 29,600 20.200 5000

Headland Corporation has contracted with you to prepare a statement of cash flows. The controller has provided the following information. Cash Accounts receivable Inventory Equity investments Buildings Equipment December 31 2025 $38.900 12.200 11.800 -0- 40,400 5.000 2024 $12.800 9.900 10,000 3.100 29,600 20.200 5000

FINANCIAL ACCOUNTING
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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**Headland Corporation Statement of Cash Flows Analysis** **Balance Sheet Data (December 31):** | Assets | 2025 | 2024 | |-----------------------------|---------|---------| | Cash | $38,900 | $12,800 | | Accounts receivable | 12,200 | 9,900 | | Inventory | 11,800 | 10,000 | | Equity investments | – | 3,100 | | Buildings | – | 29,600 | | Equipment | 40,400 | 20,200 | | Other assets | 5,000 | 5,200 | | **Totals** | $108,300| $90,800 | | Liabilities and Equity | 2025 | 2024 | |---------------------------------------------|---------|---------| | Allowance for doubtful accounts | $3,000 | $4,600 | | Accumulated depreciation—equipment | 2,000 | 4,500 | | Accumulated depreciation—buildings | – | 5,900 | | Accounts payable | 5,000 | 4,000 | | Dividends payable | – | 4,900 | | Notes payable, short-term (nontrade) | 3,000 | 4,000 | | Long-term notes payable | 36,000 | 25,000 | | Common stock | 38,000 | 33,000 | | Retained earnings | 21,300 | 4,900 | | **Totals** | $108,300| $90,800 | **Additional Data Related to 2025:** 1. Equipment costing $10,900, with 30% depreciation, was sold for $2,500. 2. $5,000 of long-term notes payable was paid by issuing common stock. 3. Cash dividends paid amounted to $4,900. 4. On January 1, 2025, the building was destroyed by a flood; insurance proceeds were $32,800 (net $4,000 taxes). 5. Equity investments were sold at $1,600 above cost; no unrealized gains or losses recorded. 6.
Transcribed Image Text:**Headland Corporation Statement of Cash Flows Analysis** **Balance Sheet Data (December 31):** | Assets | 2025 | 2024 | |-----------------------------|---------|---------| | Cash | $38,900 | $12,800 | | Accounts receivable | 12,200 | 9,900 | | Inventory | 11,800 | 10,000 | | Equity investments | – | 3,100 | | Buildings | – | 29,600 | | Equipment | 40,400 | 20,200 | | Other assets | 5,000 | 5,200 | | **Totals** | $108,300| $90,800 | | Liabilities and Equity | 2025 | 2024 | |---------------------------------------------|---------|---------| | Allowance for doubtful accounts | $3,000 | $4,600 | | Accumulated depreciation—equipment | 2,000 | 4,500 | | Accumulated depreciation—buildings | – | 5,900 | | Accounts payable | 5,000 | 4,000 | | Dividends payable | – | 4,900 | | Notes payable, short-term (nontrade) | 3,000 | 4,000 | | Long-term notes payable | 36,000 | 25,000 | | Common stock | 38,000 | 33,000 | | Retained earnings | 21,300 | 4,900 | | **Totals** | $108,300| $90,800 | **Additional Data Related to 2025:** 1. Equipment costing $10,900, with 30% depreciation, was sold for $2,500. 2. $5,000 of long-term notes payable was paid by issuing common stock. 3. Cash dividends paid amounted to $4,900. 4. On January 1, 2025, the building was destroyed by a flood; insurance proceeds were $32,800 (net $4,000 taxes). 5. Equity investments were sold at $1,600 above cost; no unrealized gains or losses recorded. 6.
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