Question :
150. An analysis of the general ledger accounts indicates that equipment, : 1226771
150. An analysis of the general ledger accounts indicates that equipment, with an original cost of $148,000 and accumulated depreciation of $105,000 on the date of sale, was sold for $39,000 during the year. Using this information, indicate the items to be reported on the statement of cash flows using the indirect method.
151. On the basis of the following data for Larson Co. for the year ending December 31, 2011 and the preceding year ended December 31, 2010, prepare a statement of cash flows. Use the indirect method of reporting cash flows from operating activities. In addition to the balance sheet data, assume that:? Equipment costing $125,000 was purchased for cash. ? Equipment costing $85,000 with accumulated depreciation of $65,000 was sold for $15,000.? The stock was issued for cash.? The only entries in the retained earnings account were net income of $51,000 and cash dividends declared of $13,000.
Year
Year
2011
2010
Cash
$100,000
$ 78,000
Accounts receivable (net)
78,000
85,000
Inventories
101,500
90,000
Equipment
410,000
370,000
Accumulated depreciation
(150,000)
(158,000)
$539,500
$465,000
Accounts payable (merchandise creditors)
$ 58,500
$ 55,000
Cash dividends payable
5,000
4,000
Common stock, $10 par
200,000
170,000
Paid-in capital in excess of par–
common stock
62,000
60,000
Retained earnings
214,000
176,000
$539,500
$465,000
152. The comparative balance sheet of Posner Company, for 2011 and the preceding year ended December 31, 2010, appears below in condensed form:
Year
Year
2011
2010
Cash
$ 53,000
$ 50,000
Accounts receivable (net)
37,000
48,000
Inventories
108,500
100,000
Investments
…..
70,000
Equipment
573,200
450,000
Accumulated depreciation-equipment
(142,000)
(176,000)
$629,700
$542,000
Accounts payable
$ 62,500
$ 43,800
Bonds payable, due 2011
…..
100,000
Common stock, $10 par
325,000
285,000
Paid-in capital in excess of par–
common stock
80,000
55,000
Retained earnings
162,200
58,200
$629,700
$542,000
The income statement for the current year is as follows:
Sales
$625,700
Cost of merchandise sold
340,000
Gross profit
$285,700
Operating expenses:
Depreciation expense
$26,000
Other operating expenses
68,000
94,000
Income from operations
$191,700
Other income:
Gain on sale of investment
$ 4,000
Other expense:
Interest expense
6,000
(2,000)
Income before income tax
$189,700
Income tax
60,700
Net income
$129,000
Additional data for the current year are as follows:
(a)
Fully depreciated equipment costing $60,000 was scrapped, no salvage, and equipment was purchased for $183,200.
(b)
Bonds payable for $100,000 were retired by payment at their face amount.
(c)
5,000 shares of common stock were issued at $13 for cash.
(d)
Cash dividends declared and paid, $25,000.
Prepare a statement of cash flows, using the indirect method of reporting cash flows from operating activities.
