Question : 200.Use the following financial statements and additional information to (1) : 1258408

 

200.Use the following financial statements and additional information to (1) prepare a statement of cash flows for the year ended December 31, 2015 using the indirect method, and (2) compute the company’s cash flow on total assets ratio for 2015. 

Derby CompanyBalance SheetsAt December 31

20152014

Assets:

Cash$85,600$65,200

Accounts receivable, net72,85056,750

Merchandise inventory157,750144,850

Prepaid expenses6,08012,680

Equipment280,600245,600

Accumulated depreciation-Equipment (80,600) (97,600)

Total assets$522,280$427,480

Liabilities:

Accounts payable$52,850$45,450

Income taxes payable15,24012,240

Notes payable (long term)   59,200   79,200

Total liabilities$127,290$136,890

Equity:

Common stock200,000150,000

Paid-in capital in excess of par53,00040,000

Retained earnings 141,990100,590

Total equity$394,990$290,590

Total liabilities and equity$522,280$427,480

 

Derby CompanyIncome StatementFor Year Ended December 31, 2015

Sales $488,000

Cost of goods sold$212,540

Depreciation expense43,000

Other operating expenses106,260

Interest expense   6,400(368,200)

Other gains (losses):

Gain on sale of equipment    4,700

Income before taxes 124,500

Income taxes expense    41,100

Net income  $83,400

Additional Information a. A $20,000 note payable is retired at its carrying value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $120,000 cash. d. Received cash for the sale of equipment that had cost $85,000, yielding a gain of $4,700. e. Prepaid expenses relate to Other Expenses on the income statement. f. All purchases and sales of merchandise inventory are on credit.    

201.Use the following financial statements and additional information to (1) prepare a complete statement of cash flows for the year ended December 31, 2013. The cash provided or used by operating activities should be reported using the direct method, and (2) compute the company’s cash flow on total assets ratio for 2015. 

Derby CompanyBalance SheetsAt December 31

20152014

Assets:

Cash$85,600$65,200

Accounts receivable, net72,85056,750

Merchandise inventory157,750144,850

Prepaid expenses6,08012,680

Equipment280,600245,600

Accumulated depreciation-Equipment (80,600) (97,600)

Total assets$522,280$427,480

Liabilities:

Accounts payable$52,850$45,450

Income taxes payable15,24012,240

Notes payable (long term)   59,200   79,200

Total liabilities$127,290$136,890

Equity:

Common stock200,000150,000

Paid-in capital in excess of par53,00040,000

Retained earnings 141,990100,590

Total equity$394,990$290,590

Total liabilities and equity$522,280$427,480

 

Derby CompanyIncome StatementFor Year Ended December 31, 2015

Sales $488,000

Cost of goods sold$212,540

Depreciation expense43,000

Other operating expenses106,260

Interest expense   6,400(368,200)

Other gains (losses):

Gain on sale of equipment    4,700

Income before taxes 124,500

Income taxes expense    41,100

Net income $83,400

Additional Information a. A $20,000 note payable is retired at its carrying value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $120,000 cash. d. Received cash for the sale of equipment that had cost $85,000, yielding a gain of $4,700. e. Prepaid expenses relate to Other Expenses on the income statement. f. All purchases and sales of merchandise inventory are on credit.    

 

 

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