The 2021 comparative balance sheet and income statement of Auga Company Ltd, have just been distributed at a meeting of the company’s board of directors. The members of the board of directors were desirous of knowing the reason or reasons why the cash balance different from the net income. The company uses the indirect method to prepare the statement of cash flows and it is expected that this should be able to provide the needed clarity required by the directors. The directors have asked each student from your accounting course to assist with the needed clarification and have put forward the following financial information grouped according to your first name initial. Having identified the information you are next required to address the requirements outlined below. Auga Company Ltd. Comparative Balance Sheet December 31, 2020 and 2021 2021 2020 Increase/(Decrease) Assets Cash 238,000 215,200 ? Accounts Receivable 303,200 259,300 ? Inventories 358,300 348,200 ? Prepaid expenses 35,350 43,100 ? Intangible assets 205,000 205,000 ? Plant assets, net 1,105,000 910,000 ? Total Assets 2,244,850 1,980,800 Liabilities Accounts payable 254,300 240,000 ? Accrued liabilities 415,300 410,000 ? Income tax payable 115,000 135,400 ? Long-term notes payable 845,400 910,500 ? Stockholders' Equity Common Stock 295,500 275,300 ? Retained earnings 345,600 295,400 ? Treasury stock (26,250) (285,800) ? Total liabilities and stockholders' equity 2,244,850 1,980,800 Auga Company Ltd. Income Statement Year Ended December 31,2021 Revenues and gains: Sales revenue 2,224,000 Gain on sale of plant assets 115,500 Total revenues and gains 2,339,500 Expenses Cost of goods sold 1,305,000 Depreciation expense 165,400 Other operating expense 405,400 Total expenses 1,875,800 Income before income taxes 463,700 Income tax expense 265,000 Net Income 198,700 Notes Acquisition of plant asset during 2021 600,900 Sale proceeds from sale of plant asset 356,000 Receipt for issuance of notes payable 384,900 Payment for note payable 450,000 Dividend paid 148,500 Book value of equipment sold 240,500 Requirements Prepare a complete statement of cash flows for 2021 using the indirect method using the information in the table above
The 2021 comparative balance sheet and income statement of Auga Company Ltd, have just been distributed at a meeting of the company’s board of directors. The members of the board of directors were desirous of knowing the reason or reasons why the cash balance different from the net income. The company uses the indirect method to prepare the statement of
The directors have asked each student from your accounting course to assist with the needed clarification and have put forward the following financial information grouped according to your first name initial. Having identified the information you are next required to address the requirements outlined below.
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Auga Company Ltd. |
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Comparative Balance Sheet |
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December 31, 2020 and 2021 |
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2021 |
2020 |
Increase/(Decrease) |
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Assets |
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Cash |
238,000 |
215,200 |
? |
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303,200 |
259,300 |
? |
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Inventories |
358,300 |
348,200 |
? |
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Prepaid expenses |
35,350 |
43,100 |
? |
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Intangible assets |
205,000 |
205,000 |
? |
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Plant assets, net |
1,105,000 |
910,000 |
? |
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Total Assets |
2,244,850 |
1,980,800 |
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Liabilities |
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Accounts payable |
254,300 |
240,000 |
? |
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Accrued liabilities |
415,300 |
410,000 |
? |
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Income tax payable |
115,000 |
135,400 |
? |
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Long-term notes payable |
845,400 |
910,500 |
? |
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Common Stock |
295,500 |
275,300 |
? |
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345,600 |
295,400 |
? |
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(26,250) |
(285,800) |
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Total liabilities and stockholders' equity |
2,244,850 |
1,980,800 |
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Auga Company Ltd. |
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Income Statement |
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Year Ended December 31,2021 |
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Revenues and gains: |
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Sales revenue |
2,224,000 |
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Gain on sale of plant assets |
115,500 |
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Total revenues and gains |
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2,339,500 |
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Expenses |
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Cost of goods sold |
1,305,000 |
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165,400 |
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Other operating expense |
405,400 |
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Total expenses |
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1,875,800 |
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Income before income taxes |
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463,700 |
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Income tax expense |
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265,000 |
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Net Income |
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198,700 |
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Notes |
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Acquisition of plant asset during 2021 |
600,900 |
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Sale proceeds from sale of plant asset |
356,000 |
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Receipt for issuance of notes payable |
384,900 |
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Payment for note payable |
450,000 |
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Dividend paid |
148,500 |
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Book value of equipment sold |
240,500 |
Requirements
- Prepare a complete statement of cash flows for 2021 using the indirect method using the information in the table above
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