Martinez Company had the following information available at the end of 2020. MARTINEZCOMPANY COMPARATIVE BALANCE SHEETS AS OF DECEMBER 31, 2020 AND 2019 2020 2019 Cash $10,030 $4,030 Accounts receivable 20,580 12,850 Short-term investments 22,130 29,700 Inventory 41,810 34,700 Prepaid rent 3,020 12,090 Prepaid insurance 2,110 91 Supplies 1,000 74 Land 125,160 176,690 Buildings 349,890 349,890 Accumulated depreciation—buildings (104,810 ) (87,100 ) Equipment 524,900 397,700 Accumulated depreciation—equipment (129,880 ) (112,640 ) Patents 45,200 49,700 Total assets $911,140 $867,775 Accounts payable $21,860 $31,980 Income taxes payable 4,960 4,010 Salaries and wages payable 4,990 3,000 Short-term notes payable 9,950 9,950 Long-term notes payable 60,050 69,870 Bonds payable 396,520 396,520 Premium on bonds payable 24,050 24,345 Common stock 241,260 221,400 Paid-in capital in excess of par—common stock 24,750 17,450 Retained earnings 122,750 89,250 Total liabilities and stockholders’ equity $911,140 $867,775 MARTINEZ COMPANY INCOME STATEMENT AND DIVIDEND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue $1,165,680 Cost of goods sold 743,390 422,290 Gross margin Operating expenses Selling expenses $79,430 Administrative expenses 156,850 Depreciation/Amortization expense 39,450 Total operating expenses 275,730 Income from operations 146,560 Other revenues/expenses Gain on sale of land 8,040 Gain on sale of short-term investment 3,960 Dividend revenue 2,410 Interest expense (51,270 ) (36,860 ) Income before taxes 109,700 Income tax expense 39,390 Net income 70,310 Dividends to common stockholders (36,810 ) To retained earnings $33,500 Prepare a statement of cash flows for Martinez Company using the direct method accompanied by a reconciliation schedule. Assume the short-term investments are debt securities, classified as available-for-sale. (Show amounts in the investing and financing sections that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Martinez Company had the following information available at the end of 2020. MARTINEZCOMPANY COMPARATIVE BALANCE SHEETS AS OF DECEMBER 31, 2020 AND 2019 2020 2019 Cash $10,030 $4,030 Accounts receivable 20,580 12,850 Short-term investments 22,130 29,700 Inventory 41,810 34,700 Prepaid rent 3,020 12,090 Prepaid insurance 2,110 91 Supplies 1,000 74 Land 125,160 176,690 Buildings 349,890 349,890 Accumulated depreciation—buildings (104,810 ) (87,100 ) Equipment 524,900 397,700 Accumulated depreciation—equipment (129,880 ) (112,640 ) Patents 45,200 49,700 Total assets $911,140 $867,775 Accounts payable $21,860 $31,980 Income taxes payable 4,960 4,010 Salaries and wages payable 4,990 3,000 Short-term notes payable 9,950 9,950 Long-term notes payable 60,050 69,870 Bonds payable 396,520 396,520 Premium on bonds payable 24,050 24,345 Common stock 241,260 221,400 Paid-in capital in excess of par—common stock 24,750 17,450 Retained earnings 122,750 89,250 Total liabilities and stockholders’ equity $911,140 $867,775 MARTINEZ COMPANY INCOME STATEMENT AND DIVIDEND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue $1,165,680 Cost of goods sold 743,390 422,290 Gross margin Operating expenses Selling expenses $79,430 Administrative expenses 156,850 Depreciation/Amortization expense 39,450 Total operating expenses 275,730 Income from operations 146,560 Other revenues/expenses Gain on sale of land 8,040 Gain on sale of short-term investment 3,960 Dividend revenue 2,410 Interest expense (51,270 ) (36,860 ) Income before taxes 109,700 Income tax expense 39,390 Net income 70,310 Dividends to common stockholders (36,810 ) To retained earnings $33,500 Prepare a statement of cash flows for Martinez Company using the direct method accompanied by a reconciliation schedule. Assume the short-term investments are debt securities, classified as available-for-sale. (Show amounts in the investing and financing sections that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Martinez Company had the following information available at the end of 2020.

MARTINEZCOMPANY COMPARATIVE BALANCE SHEETS AS OF DECEMBER 31, 2020 AND 2019
	2020		2019
Cash	$10,030			$4,030
Accounts receivable	20,580			12,850
Short-term investments	22,130			29,700
Inventory	41,810			34,700
Prepaid rent	3,020			12,090
Prepaid insurance	2,110			91
Supplies	1,000			74
Land	125,160			176,690
Buildings	349,890			349,890
Accumulated depreciation—buildings	(104,810	)		(87,100	)
Equipment	524,900			397,700
Accumulated depreciation—equipment	(129,880	)		(112,640	)
Patents	45,200			49,700
Total assets	$911,140			$867,775

Accounts payable	$21,860			$31,980
Income taxes payable	4,960			4,010
Salaries and wages payable	4,990			3,000
Short-term notes payable	9,950			9,950
Long-term notes payable	60,050			69,870
Bonds payable	396,520			396,520
Premium on bonds payable	24,050			24,345
Common stock	241,260			221,400
Paid-in capital in excess of par—common stock	24,750			17,450
Retained earnings	122,750			89,250
Total liabilities and stockholders’ equity	$911,140			$867,775

MARTINEZ COMPANY INCOME STATEMENT AND DIVIDEND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2020
Sales revenue			$1,165,680
Cost of goods sold			743,390
			422,290

Gross margin
Operating expenses
Selling expenses	$79,430
Administrative expenses	156,850
Depreciation/Amortization expense	39,450
Total operating expenses			275,730
Income from operations			146,560
Other revenues/expenses
Gain on sale of land	8,040
Gain on sale of short-term investment	3,960
Dividend revenue	2,410
Interest expense	(51,270	)	(36,860	)
Income before taxes			109,700
Income tax expense			39,390
Net income			70,310
Dividends to common stockholders			(36,810	)
To retained earnings			$33,500

Prepare a statement of cash flows for Martinez Company using the direct method accompanied by a reconciliation schedule. Assume the short-term investments are debt securities, classified as available-for-sale. (Show amounts in the investing and financing sections that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Reconciliation Schedule
Reconciliation of Net Income to
Adjustments to reconcile net income to
>>>

MARTINEZ COMPANY
Statement of Cash Flows
(Direct Method)
Cash receipts:
Cash payments:
(Show amounts that decrease cash flow with either a - sign eg. -15,000 or in parenthesis eg. (15,000).)

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