Monty Inc, a greeting card company, had the following statements prepared as of December 31, 2020 Additional Information: 1. Dividends in the amount of $6100 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 $20,200 and was 70% depreciated was sold during 2020

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Monty Inc, a greeting card company, had the following statements prepared as of December 31, 2020

Additional Information:

1. Dividends in the amount of $6100 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 $20,200 and was 70% depreciated was sold during 2020

Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a-sign eg.-15,000 or in
parenthesise.g. (15,000))
Adjustments to reconcile net income to
MONTY INC.
Statement of Cash Flows
V
<
<
$
Transcribed Image Text:Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a-sign eg.-15,000 or in parenthesise.g. (15,000)) Adjustments to reconcile net income to MONTY INC. Statement of Cash Flows V < < $
Cash
Accounts receivable
Short-term debt investments (available-for-sale)
Inventory
Prepaid rent
Equipment
Accumulated depreciation-equipment
Copyrights
Total assets
MONTY INC.
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2020 AND 2019
12/31/20
$6,100
62,200
34,900
40,300
5,000
153,200
(35,000)
46,200
$312,900
Accounts payable
Income taxes payable
Salaries and wages payable
Short-term loans payable
Long-term loans payable
Common stock, $10 par
Contributed capital, common stock
Retained earnings
Total liabilities & stockholders' equity
Sales revenue
Cost of goods sold
Gross profit
MONTY INC.
INCOME STATEMENT
FOR THE YEAR ENDING DECEMBER 31, 2020
$336,150
174,100
162,050
120,800
41,250
Operating expenses
Operating income
Interest expense
Gain on sale of equipment
Income before tax
Income tax expense
Net income
$11,400
1,900
100,000
30,000
57,100
$312,900
$46,000
4,000
7,900
8,100
59,800
9,500
31,750
6,350
$25,400
12/31/19
$7,000
51,500
17,900
60,500
3,900
131,200
(24,700 )
49,800
$297,100
$40,000
6,000
4,000
10,100
69,200
100,000
30,000
37,800
$297,100
Transcribed Image Text:Cash Accounts receivable Short-term debt investments (available-for-sale) Inventory Prepaid rent Equipment Accumulated depreciation-equipment Copyrights Total assets MONTY INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 12/31/20 $6,100 62,200 34,900 40,300 5,000 153,200 (35,000) 46,200 $312,900 Accounts payable Income taxes payable Salaries and wages payable Short-term loans payable Long-term loans payable Common stock, $10 par Contributed capital, common stock Retained earnings Total liabilities & stockholders' equity Sales revenue Cost of goods sold Gross profit MONTY INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2020 $336,150 174,100 162,050 120,800 41,250 Operating expenses Operating income Interest expense Gain on sale of equipment Income before tax Income tax expense Net income $11,400 1,900 100,000 30,000 57,100 $312,900 $46,000 4,000 7,900 8,100 59,800 9,500 31,750 6,350 $25,400 12/31/19 $7,000 51,500 17,900 60,500 3,900 131,200 (24,700 ) 49,800 $297,100 $40,000 6,000 4,000 10,100 69,200 100,000 30,000 37,800 $297,100
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