Question : 141. Financial information for Price Company at December 31, 2014, and : 1245801

 

141. Financial information for Price Company at December 31, 2014, and for the year then ended, are presented below: 

 

 

 

 

 

 

 

 

 

 

 

     December 31,

 

 

 

 

 

 

 

 

Cash

 

 

 

$       31,000

$    15,000

 

Accounts receivable

 

 

  28,500

  30,000

 

Allowance for doubtful accounts

 

    (2,000)

  (1,500)

 

Inventory 

 

 

 

    15,000

  10,000

 

Prepaid insurance

 

 

     1,400

   2,400

 

Property, plant, and equipment

 

     81,000

  80,000

 

Accumulated depreciation

 

    (16,000)

(20,000)

 

Land

 

 

 

 

 

 

 

Total assets

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable

 

 

$        11,000

$    10,000

 

Wages payable

 

 

   1,000

     2,000

 

Interest payable

 

 

      1,000

         –  

 

Notes payable, long-term

 

 

   46,000

   20,000

 

Common stock, nopar

 

 

     136,000

100,000

 

Retained earnings

 

 

 

 

 

 

Total liabilities and

 

 

 

 

 

stockholders’ equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales revenue

 

 

$         80,000

 

 

 

Cost of goods sold

 

      (35,000)

 

 

 

Depreciation expense

 

       (5,000)

 

 

 

Bad debt expense

 

       (1,000)

 

 

 

Insurance expense

 

     (1,000)

 

 

 

Interest expense

 

       (2,000)

 

 

 

Salaries and wages expense

 

       (12,000)

 

 

 

Income tax expense

 

        (3,000)

 

 

 

Remaining expenses

 

  (13,000)

 

 

 

Loss on sale of operational assets

 

 

 

 

Net income

 

 

 

 

 

 

 

 

 

 

 

Additional information: 

1.

Wrote off $500 accounts receivable as uncollectible.

 

 

2.

Sold an operational asset for $4,000 cash (cost, $15,000, accumulated depreciation, $9,000).

 

 

3.

Issued common stock for $5,000 cash.

 

 

4.

Declared and paid a cash dividend of $5,000.

 

 

5.

Purchased land for $20,000 cash.

 

 

6.

Acquired land for $21,000, and issued common stock as payment in full.

 

 

7.

Acquired operational assets, cost $16,000; issued a $16,000, three-year, interest-bearing note payable.

 

 

8.

Paid a $10,000 long-term note installment by issuing common stock to the creditor.

 

 

9.

Borrowed cash on a long-term note, $20,000.

 

 

Required:Prepare the statement of cash flows using the indirect method.