Concept explainers
Statement of
Orlando Incorporated At December 31 |
||
Assets | Current Year | Prior Year |
Current Assets | ||
Cash | $ 60,750 | $ 69,700 |
Available for-Sale Debt Investments | 78,300 | 110,700 |
128,250 | 74,250 | |
Merchandise Inventory | 182,250 | 128,250 |
Total Current Assets | $ 449,550 | $ 382,900 |
Noncurrent Assets | ||
Investments m Affiliate Companies | $ 357,750 | $ 135,675 |
Property, Plant, and Equipment - net | 1,842,075 | 2,066,175 |
Intangible Assets - net | 118,125 | 168,750 |
Total Noncurrent Assets | $2,317,950 | $2,370,600 |
Total Assets | $ 2,767,500 | $2,753,500 |
Liabilities | ||
Current Liabilities | ||
Current Portion of Long-Term Debt | $ 33,750 | $ 88,830 |
Accounts Payable | 252,450 | 213,475 |
Dividends Payable | 101,250 | 74,250 |
Income Taxes Payable | 88,830 | 78,975 |
Total Current Liabilities | $ 476,280 | $ 455,530 |
Noncurrent Liabilities |
Bonds Payable | $ 540,000 | $ 540,000 |
Less: Discount on Bonds | (173,475) | (195,750) |
Notes Payable | 304,425 | 303,750 |
84,375 | 97,875 | |
Net Obligations under Pension Plans | 108,000 | 81,000 |
Total Noncurrent Liabilities | $ 863,325 | $ 826,875 |
Total Liabilities | $1,339,605 | $1,282,405 |
Orlando Incorporated Balance Sheets At December 31 |
||
Current Year | Prior Year | |
Shareholders' Equity | ||
Common Stock, $1 par value | $ 182,250 | $ 182,250 |
Additional Paid-in Capital in Excess of Par - Common | 474,525 | 474,525 |
Additional Paid-in Capital - Stock Options | 22,275 | 0 |
924,750 | 706,995 | |
Accumulated Other Comprehensive Income | (175,905) | 107,325 |
Total Shareholders' Equity | $ 1,427,895 | $1,471,095 |
Total Liabilities and Shareholders' Equity | S 2,767,500 | $2,753,500 |
Orlando Incorporated Income Statement For the Current Year Ended December 31 |
|
Sales | $2,342,000 |
Cost of Goods Sold | 1,405,200 |
Gross Profit | $ 936,800 |
Selling, General, and Administrative Expenses | $ 66,500 |
Pension Expense | 200,150 |
Bad Debt Expense | 2,835 |
25,500 | |
Amortization Expense | 9,000 |
Total Operating Expenses | $ 303,985 |
Operating Income | $ 632,815 |
Loss on Disposal of Equipment | $ (35,000) |
Interest Expense | (75,110) |
Investment Income (includes loss on sale) | 5,000 |
Equity Earnings from Affiliate Companies | 330,350 |
Income from Continuing Operations before Tax | $ 858,055 |
Income Tax Expense | (343,222) |
Income from Continuing Operations | $ 514,833 |
Loss from Discontinued Operations - net of tax | (16,478) |
Net Income | $ 498,355 |
Additional Information
- Orlando sold available-for-sale investments that had been acquired for the cost of $74, 250 at a loss of $14, 250 It included this loss in investment income on the income statement
- It acquired additional shares as investments to be carried at fair value Orlando accounted for all investments except for investments carried under the equity method as available-for-sale securities It recorded a $6, 000 unrealized loss for the current year
- It reported accounts receivable net of the allowance for
bad debts - It did not acquire additional plant and equipment during the year but sold a piece of equipment that had cost $198, 600
- It did not increase its percentage ownership of its equity investee (affiliate company)
- It sold one of its franchises at book value
- It signed a $675 promissory note.
- It reported the loss from discontinued operations net of tax and as a cash transaction.
Required
Prepare the current-year cash flow statement for Orlando Incorporated under the indirect method. Present required disclosures.
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