statement are provided below, along with additional information. Current Year Balance Sheet at December 31 Cash Accounts Receivable Equipment Less: Accumulated Depreciation Accounts Payable Wages Payable Long-Term Bank Loan Payable Contributed Capital Retained Earnings Income Statement (current year). Lessons Revenue Wages Expense Depreciation Expense Income Tax Expense Net Income $ 6,000 1,000 5,500 (1,500) $11,000 $ 500 500 1,500 5,000 3,500 $11,000 $37,500 35,000 250 1,000 $1,250 Additional notes: a. Bought new hockey equipment for cash, $500. b. Borrowed $1,000 cash from the bank during the year. Account Re Prior Year $4,000 1,750 5,000 (1,250) $ 9,500 $ 1,000 750 500 5,000 2,250 $ 9,500
statement are provided below, along with additional information. Current Year Balance Sheet at December 31 Cash Accounts Receivable Equipment Less: Accumulated Depreciation Accounts Payable Wages Payable Long-Term Bank Loan Payable Contributed Capital Retained Earnings Income Statement (current year). Lessons Revenue Wages Expense Depreciation Expense Income Tax Expense Net Income $ 6,000 1,000 5,500 (1,500) $11,000 $ 500 500 1,500 5,000 3,500 $11,000 $37,500 35,000 250 1,000 $1,250 Additional notes: a. Bought new hockey equipment for cash, $500. b. Borrowed $1,000 cash from the bank during the year. Account Re Prior Year $4,000 1,750 5,000 (1,250) $ 9,500 $ 1,000 750 500 5,000 2,250 $ 9,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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 alt="nces
Requirea:
1. Prepare the statement of cash flows for the year ended December 31 using the direct method. (Amounts to be deducted should be
indicated by a minus sign.)
HEADS UP COMPANY
Statement of Cash Flows
For the Year Ended December 31
Cash flows from operating activities:
Cash flows from investing activities:
Cash flows from financing activities:
Net increase in cash during the year
Cash balance, January 1
Cash balance, December 31
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Transcribed Image Text:nces
Requirea:
1. Prepare the statement of cash flows for the year ended December 31 using the direct method. (Amounts to be deducted should be
indicated by a minus sign.)
HEADS UP COMPANY
Statement of Cash Flows
For the Year Ended December 31
Cash flows from operating activities:
Cash flows from investing activities:
Cash flows from financing activities:
Net increase in cash during the year
Cash balance, January 1
Cash balance, December 31
< Prev
4 of 5
Next >

Transcribed Image Text:Heads Up Company was started several years ago by two hockey instructors. The company's comparative balance sheets and income
statement are provided below, along with additional information.
Balance Sheet at December 31
Cash
Accounts Receivable
Equipment
Less: Accumulated Depreciation
Accounts Payable
Wages Payable
Long-Term Bank Loan Payable
Contributed Capital
Retained Earnings
Income Statement (current year).
Lessons Revenue
Wages Expense
Depreciation Expense
Income Tax Expense
Net Income
Current
Year
$6,000
1,000
5,500
(1,500)
$11,000
$
500
500
1,500
5,000
3,500
$11,000
$37,500
35,000
250
1,000
$1,250
Prior
Year
$4,000
1,750
5,000
(1,250)
$ 9,500
$ 1,000
750
500
5,000
2,250
$ 9,500
Additional notes:
a. Bought new hockey equipment for cash, $500.
b. Borrowed $1,000 cash from the bank during the year.
c. Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liability
accounts relating to income tax, assume that this expense was fully paid in cash.
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