The comparative balance sheets for Vaughn Corporation show the following information. Cash Accounts receivable Inventory Available-for-sale debt investments Buildings Equipment Patents Allowance for doubtful accounts Accumulated depreciation-equipment Accumulated depreciation-building Accounts payable Dividends payable Notes payable, short-term (nontrade) Long-term notes payable Common stock Retained earnings 1. 2. Additional data related to 2020 are as follows. 3. December 31 2020 $33,200 12,200 8,900 2,900 30,100 45,300 20,200 5,000 6,300 $107,800 $91,500 12,100 -0- -0- $3,000 $4,500 2,000 4,500 6,000 2,900 5,000 4,000 25,000 -0- 5,000 -0- 2019 $13,000 10,100 3,000 31,000 43,000 20,800 $107,800 33,000 6,600 $91,500 Equipment that had cost $11,000 and was 40% depreciated at time of disposal was sold for $2,500. $10,000 of the long-term note payable was paid by issuing common stock. Cash dividends paid were $5.000

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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4.
5.
6.
7.
8.
On January 1, 2020, the building was completely destroyed by a flood. Insurance proceeds on the building were $30,300 (net
of $2,000 taxes).
Debt investments (available-for-sale) were sold at $1,700 above their cost. The company has made similar sales and
investments in the past.
Cash was paid for the acquisition of equipment.
A long-term note for $16,000 was issued for the acquisition of equipment.
Interest of $2,000 and income taxes of $6,500 were paid in cash.
Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a-sign e.g.-15,000 or in
parenthesis e.g. (15,000).)
Adjustments to reconcile net income to
VAUGHN CORPORATION
Statement of Cash Flows
>
<
<
> >
SA
69
Transcribed Image Text:4. 5. 6. 7. 8. On January 1, 2020, the building was completely destroyed by a flood. Insurance proceeds on the building were $30,300 (net of $2,000 taxes). Debt investments (available-for-sale) were sold at $1,700 above their cost. The company has made similar sales and investments in the past. Cash was paid for the acquisition of equipment. A long-term note for $16,000 was issued for the acquisition of equipment. Interest of $2,000 and income taxes of $6,500 were paid in cash. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a-sign e.g.-15,000 or in parenthesis e.g. (15,000).) Adjustments to reconcile net income to VAUGHN CORPORATION Statement of Cash Flows > < < > > SA 69
The comparative balance sheets for Vaughn Corporation show the following information.
Cash
Accounts receivable
Inventory
Available-for-sale debt investments
Buildings
Equipment
Patents
Allowance for doubtful accounts
Accumulated depreciation-equipment
Accumulated depreciation-building
Accounts payable
Dividends payable
Notes payable, short-term (nontrade)
Long-term notes payable
Common stock
Retained earnings
1.
2.
Additional data related to 2020 are as follows.
3.
December 31
2020
$33,200
12,200
12,100
-0-
-0-
45,300
5,000
20,200
6,300
$107,800 $91,500
-0-
2019
$13,000
10,100
8,900
2,900
$3,000 $4,500
2,000
4,500
6,000
2,900
5,000
4,000
25,000
33,000
6,600
$91,500
5,000
-0-
3,000
31,000
43,000
20,800
$107,800
30,100
Equipment that had cost $11,000 and was 40% depreciated at time of disposal was sold for $2,500.
$10,000 of the long-term note payable was paid by issuing common stock.
Cash dividends paid were $5,000.
Transcribed Image Text:The comparative balance sheets for Vaughn Corporation show the following information. Cash Accounts receivable Inventory Available-for-sale debt investments Buildings Equipment Patents Allowance for doubtful accounts Accumulated depreciation-equipment Accumulated depreciation-building Accounts payable Dividends payable Notes payable, short-term (nontrade) Long-term notes payable Common stock Retained earnings 1. 2. Additional data related to 2020 are as follows. 3. December 31 2020 $33,200 12,200 12,100 -0- -0- 45,300 5,000 20,200 6,300 $107,800 $91,500 -0- 2019 $13,000 10,100 8,900 2,900 $3,000 $4,500 2,000 4,500 6,000 2,900 5,000 4,000 25,000 33,000 6,600 $91,500 5,000 -0- 3,000 31,000 43,000 20,800 $107,800 30,100 Equipment that had cost $11,000 and was 40% depreciated at time of disposal was sold for $2,500. $10,000 of the long-term note payable was paid by issuing common stock. Cash dividends paid were $5,000.
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