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Sales revenue Less: Cost of goods sold Operating expenses, excluding depreciation Depreciation expense Income tax expense Interest expense Loss on disposal of plant assets Net income Additional information: 1. 2. 3. SHERIDAN INC. Income Statement For the Year Ended December 31, 2022 4. 5. $135,000 13,000 29,800 26,300 4,300 7,500 $392,200 215,900 $176,300 New plant assets costing $79,700 were purchased for cash during the year. Old plant assets having an original cost of $45,700 and accumulated depreciation of $35,200 were sold for $3,000 cash. Bonds payable matured and were paid off at face value for cash. A cash dividend of $29,500 was declared and paid during the year. Common stock was issued at par for cash.

Sales revenue Less: Cost of goods sold Operating expenses, excluding depreciation Depreciation expense Income tax expense Interest expense Loss on disposal of plant assets Net income Additional information: 1. 2. 3. SHERIDAN INC. Income Statement For the Year Ended December 31, 2022 4. 5. $135,000 13,000 29,800 26,300 4,300 7,500 $392,200 215,900 $176,300 New plant assets costing $79,700 were purchased for cash during the year. Old plant assets having an original cost of $45,700 and accumulated depreciation of $35,200 were sold for $3,000 cash. Bonds payable matured and were paid off at face value for cash. A cash dividend of $29,500 was declared and paid during the year. Common stock was issued at par for cash.

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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prepare a statement of cash flows using the indirect method

**SHERIDAN INC. Income Statement For the Year Ended December 31, 2022** - **Sales Revenue:** $392,200 **Less:** - **Cost of Goods Sold:** $135,000 - **Operating Expenses, Excluding Depreciation:** $13,000 - **Depreciation Expense:** $29,800 - **Income Tax Expense:** $26,300 - **Interest Expense:** $4,300 - **Loss on Disposal of Plant Assets:** $7,500 **Total Expenses:** $215,900 **Net Income:** $176,300 **Additional Information:** 1. New plant assets costing $79,700 were purchased for cash during the year. 2. Old plant assets having an original cost of $45,700 and accumulated depreciation of $35,200 were sold for $3,000 cash. 3. Bonds payable matured and were paid off at face value for cash. 4. A cash dividend of $29,500 was declared and paid during the year. 5. Common stock was issued at par for cash.
Transcribed Image Text:**SHERIDAN INC. Income Statement For the Year Ended December 31, 2022** - **Sales Revenue:** $392,200 **Less:** - **Cost of Goods Sold:** $135,000 - **Operating Expenses, Excluding Depreciation:** $13,000 - **Depreciation Expense:** $29,800 - **Income Tax Expense:** $26,300 - **Interest Expense:** $4,300 - **Loss on Disposal of Plant Assets:** $7,500 **Total Expenses:** $215,900 **Net Income:** $176,300 **Additional Information:** 1. New plant assets costing $79,700 were purchased for cash during the year. 2. Old plant assets having an original cost of $45,700 and accumulated depreciation of $35,200 were sold for $3,000 cash. 3. Bonds payable matured and were paid off at face value for cash. 4. A cash dividend of $29,500 was declared and paid during the year. 5. Common stock was issued at par for cash.
**SHERIDAN INC.** **Comparative Balance Sheets** **December 31** --- ### Assets | Description | 2022 | 2021 | |---------------------------|-----------|-----------| | Cash | $107,500 | $47,700 | | Accounts receivable | 91,400 | 33,900 | | Inventory | 112,200 | 102,200 | | Prepaid expenses | 29,100 | 25,400 | | Long-term investments | 140,700 | 114,600 | | Plant assets | 275,200 | 241,200 | | Accumulated depreciation | (47,500) | (52,900) | | **Total** | **$708,600** | **$512,100** | --- ### Liabilities and Stockholders’ Equity | Description | 2022 | 2021 | |----------------------------|-----------|-----------| | Accounts payable | $112,000 | $67,500 | | Accrued expenses payable | 16,000 | 17,100 | | Bonds payable | 111,300 | 149,900 | | Common stock | 219,700 | 174,800 | | Retained earnings | 249,600 | 102,800 | | **Total** | **$708,600** | **$512,100** | This comparative balance sheet for Sheridan Inc. shows the financial position as of December 31 for the years 2022 and 2021. It includes detailed listings of assets and liabilities, alongside stockholders' equity. Accumulated depreciation is recorded as a deduction under assets, reflecting the reduction in the value of plant assets. The total for both assets and liabilities plus equity align, maintaining the balance sheet equation.
Transcribed Image Text:**SHERIDAN INC.** **Comparative Balance Sheets** **December 31** --- ### Assets | Description | 2022 | 2021 | |---------------------------|-----------|-----------| | Cash | $107,500 | $47,700 | | Accounts receivable | 91,400 | 33,900 | | Inventory | 112,200 | 102,200 | | Prepaid expenses | 29,100 | 25,400 | | Long-term investments | 140,700 | 114,600 | | Plant assets | 275,200 | 241,200 | | Accumulated depreciation | (47,500) | (52,900) | | **Total** | **$708,600** | **$512,100** | --- ### Liabilities and Stockholders’ Equity | Description | 2022 | 2021 | |----------------------------|-----------|-----------| | Accounts payable | $112,000 | $67,500 | | Accrued expenses payable | 16,000 | 17,100 | | Bonds payable | 111,300 | 149,900 | | Common stock | 219,700 | 174,800 | | Retained earnings | 249,600 | 102,800 | | **Total** | **$708,600** | **$512,100** | This comparative balance sheet for Sheridan Inc. shows the financial position as of December 31 for the years 2022 and 2021. It includes detailed listings of assets and liabilities, alongside stockholders' equity. Accumulated depreciation is recorded as a deduction under assets, reflecting the reduction in the value of plant assets. The total for both assets and liabilities plus equity align, maintaining the balance sheet equation.
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