The comparative balance sheet of Gold Coast Company for Years 1 and 2 ended December 31 appears below in condensed form: Year 2 Year 1 Cash $ 64,000 $ 42,500 Accounts receivable (net) 61,000 70,200 Inventories 121,000 105,000 Investments 100,000 Equipment 520,000 425,000 Accumulated depreciation-equipment (150,000) (175,000) $616,000 $567,700 Accounts payable $44,750 $35,250 Dividends Payable $15,000 $12,000 Bonds payable 75,000 Common stock, $20 par 375,000 325,000 Premium on common stock 50,000 25,000 131.250 95.450 Retained earnings $616,000 $567,700 Additional data for the current year are as follows: (a) Net income, $80,000. (b) Depreciation reported on income statement, $35,000. (c) Equipment costing $80,000 that has been depreciated for $60,000 was sold for $10,000, and new equipment was purchased for $170,000. (d) Bonds payable for $75,000 were retired at 98 their face amount. (e) 2,500 shares of common stock were issued at $30 for cash. (f) Cash dividends declared $25,000 (g) Investments of $100,000 were sold for $110,000. Prepare just the Operating section of the statement of cash flows using the indirect method.
The comparative balance sheet of Gold Coast Company for Years 1 and 2 ended December 31 appears below in condensed form: Year 2 Year 1 Cash $ 64,000 $ 42,500 Accounts receivable (net) 61,000 70,200 Inventories 121,000 105,000 Investments 100,000 Equipment 520,000 425,000 Accumulated depreciation-equipment (150,000) (175,000) $616,000 $567,700 Accounts payable $44,750 $35,250 Dividends Payable $15,000 $12,000 Bonds payable 75,000 Common stock, $20 par 375,000 325,000 Premium on common stock 50,000 25,000 131.250 95.450 Retained earnings $616,000 $567,700 Additional data for the current year are as follows: (a) Net income, $80,000. (b) Depreciation reported on income statement, $35,000. (c) Equipment costing $80,000 that has been depreciated for $60,000 was sold for $10,000, and new equipment was purchased for $170,000. (d) Bonds payable for $75,000 were retired at 98 their face amount. (e) 2,500 shares of common stock were issued at $30 for cash. (f) Cash dividends declared $25,000 (g) Investments of $100,000 were sold for $110,000. Prepare just the Operating section of the statement of cash flows using the indirect method.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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