Malouin Corp's income statement for the year ended December 31, 2023, had the following condensed information: Service revenue Operating expenses (excluding depreciation) Depreciation expense Unrealized loss on FV-NI investments Loss on disposal of equipment Income before income tax Income tax expense Net income 2023 FV-NI investments Accounts receivable 35,000 Accounts payable 44,000 Income tax payable 6,000 2022 $499,000 66,000 4,000 $22,000 $26,000 54,000 31,000 8,500 14,000 $778,000 There were no purchases or sales of trading (FV-NI) investments during 2023. Malouin's statement of financial position included the following comparative data at December 31: 583,000 195,000 58,000 $137,000
Malouin Corp's income statement for the year ended December 31, 2023, had the following condensed information: Service revenue Operating expenses (excluding depreciation) Depreciation expense Unrealized loss on FV-NI investments Loss on disposal of equipment Income before income tax Income tax expense Net income 2023 FV-NI investments Accounts receivable 35,000 Accounts payable 44,000 Income tax payable 6,000 2022 $499,000 66,000 4,000 $22,000 $26,000 54,000 31,000 8,500 14,000 $778,000 There were no purchases or sales of trading (FV-NI) investments during 2023. Malouin's statement of financial position included the following comparative data at December 31: 583,000 195,000 58,000 $137,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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Transcribed Image Text:Prepare the operating activities section of the statement of cash flows using the direct method. (Show amounts that decrease cash
flow with either a negative sign e.g.-15,000 or in parenthesis e.g. (15,000).)
Malouin Corp.
Partial Statement of Cash Flows (Direct Method)
>
>
$
Transcribed Image Text:Malouin Corp's income statement for the year ended December 31, 2023, had the following condensed information:
Service revenue
Operating expenses (excluding depreciation)
Depreciation expense
Unrealized loss on FV-NI investments
Loss on disposal of equipment
Income before income tax
Income tax expense
Net income
2023
$22,000 $26,000
2022
FV-NI investments
Accounts receivable 35,000
Accounts payable
44,000
Income tax payable
6,000
54,000
31,000
$499,000
8,500
66,000
There were no purchases or sales of trading (FV-NI) investments during 2023.
Malouin's statement of financial position included the following comparative data at December 31:
4,000
14,000
$778,000
583,000
195,000
58,000
$137,000
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