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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

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
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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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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