The following financial statements were drawn from the records of Thornton Shoes:Balance SheetsAs of December 31AssetsCashAccounts receivableMerchandise inventoryNotes receivableEquipmentAccumulated depreciation-equipmentLandTotal assetsLiabilitiesAccounts payableSalaries payableUtilities payableInterest payableNotes payable (long-term)Common stockRetained earningsYear 2$123,69554,547123,811Cost of goods soldGross margin0141, 100(68,370)80,000$454,783$ 41,879 $27, 188653301,70083,363Total liabilities and equity $454,78300Income StatementFor the Year Ended December 31, Year 2Sales revenueOperating expensesSalaries expenseDepreciation expenseUtilities expenseOperating incomeNonoperating itemsInterest expenseLoss on the sale of equipmentNet incomeYear 1$ 26,54063, 160112,02028,000250,700(135,590)50,000$ 394,830$ 588,91061,500239,90019,525$ 394,830(292,423)296, 487(186,140)(15,910)(11,890)82,547(2,526)(1,630)48,46021,750$78,3911,3052,390Additional Information1. Sold equipment costing $109,600 with accumulated depreciation of $83,130 for $24,840 cash.2. Paid a $14,553 cash dividend to owners. 1. Sold equipment costing $109,600 with accumulated depreciation of $83,130 for $24,840 cash.2. Paid a $14,553 cash dividend to owners.Required:Analyze the data and prepare a statement of cash flows using the direct method. (Amounts to be deducted and cashoutflows should be indicated by a minus sign.)THORNTON SHOESStatement of Cash FlowsFor the Year Ended December 31, Year 2Cash Flows From OperatingActivities:Cash receipts from customersCash Payments for:Total cash outflowsCash Flows from InvestingActivities:Cash Flows from FinancingActivities:Ending cash balance$000000

Cash Flow Statement - Statement of Cash Flow shows the inflow and outflow of cash during the…

The following financial statements were drawn from the records of Thornton Shoes: Assets Cash Balance Sheets As of December 31 Accounts receivable Merchandise inventory Notes receivable Equipment Accumulated depreciation- equipment Land Total assets Liabilities Accounts payable Salaries payable Utilities payable. Interest payable Notes payable (long-term) Common stock Retained earnings Year 2 $123,695 54,547 Cost of goods sold Gross margin 123, 811 0 141, 100 (68,370) 80,000 $454,783 $ 41,879 27, 188 653 301,700 83,363 Total liabilities and equity $454,783 0 0 Operating expenses Salaries expense Depreciation expense Utilities expense Operating income Nonoperating items. Interest expense Loss on the sale of equipment_ Net income $ Income Statement For the Year Ended December 31, Year 2 Sales revenue $588,910 $ 26,540 63, 160 112,020 28,000 250,700 (135,590) 50,000 $ 394,830 $ (292,423) 296,487 Year 1 61,500 239,900 19,525 $394,830 (186, 140) (15,910) (11,890) 82,547 (2,526) (1,630) 78,391 48,460 21,750 1,305 2,390 Additional Information 1. Sold equipment costing $109,600 with accumulated depreciation of $83,130 for $24,840 cash. 2. Paid a $14,553 cash dividend to owners.

The following financial statements were drawn from the records of Thornton Shoes: Assets Cash Balance Sheets As of December 31 Accounts receivable Merchandise inventory Notes receivable Equipment Accumulated depreciation- equipment Land Total assets Liabilities Accounts payable Salaries payable Utilities payable. Interest payable Notes payable (long-term) Common stock Retained earnings Year 2 $123,695 54,547 Cost of goods sold Gross margin 123, 811 0 141, 100 (68,370) 80,000 $454,783 $ 41,879 27, 188 653 301,700 83,363 Total liabilities and equity $454,783 0 0 Operating expenses Salaries expense Depreciation expense Utilities expense Operating income Nonoperating items. Interest expense Loss on the sale of equipment_ Net income $ Income Statement For the Year Ended December 31, Year 2 Sales revenue $588,910 $ 26,540 63, 160 112,020 28,000 250,700 (135,590) 50,000 $ 394,830 $ (292,423) 296,487 Year 1 61,500 239,900 19,525 $394,830 (186, 140) (15,910) (11,890) 82,547 (2,526) (1,630) 78,391 48,460 21,750 1,305 2,390 Additional Information 1. Sold equipment costing $109,600 with accumulated depreciation of $83,130 for $24,840 cash. 2. Paid a $14,553 cash dividend to owners.

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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