Sign Language Hearing Co Ltd Comparative Balance Sheet October 31, 2020, and 2021   2021 2020 Assets     Cash and cash equivalent      320,000         275,000 Accounts Receivable      180,000         240,000 Prepaid expenses      240,000         220,000 Equipment, net      350,000         210,000 Total Assets  1,090,000         945,000 Liabilities     Accounts payable      305,000         285,000 Accrued liabilities      285,000         305,000 Bond payable      195,000           95,000 Stockholders' Equity:     Common Stock        95,000           55,000 Retained earnings      350,000         255,000 Treasury stock    (140,000)          (50,000) Total liabilities and stockholders' equity  1,090,000          945,000     Sign Language Hearing Co Ltd Income Statement Year Ended October 31,2021 Revenues and gains:        Sales revenue      850,000      Gain on sale of equipment         Interest revenue          2,500         Total revenues and gains           852,500 Expenses        Cost of goods sold      465,500      Salary expense        65,500      Depreciation expense        24,000      Rent expense        49,500      Loss on sale of equipment          2,500         Total expenses           607,000 Income before income taxes           245,500 Income tax expense              38,000 Net Profit           207,500                         Notes     Purchase of equipment           243,000 Cash receipt from sale of equipment              76,500 Issuance of bonds payable to borrow cash           100,000 Cash receipt from issuance of common stock              40,000 Dividend paid           112,500 Book value of equipment sold              79,000 Purchase of treasury stock              90,000 Prepare a complete statement of cash flows for October 2021 using the indirect method based on the information and guidance provided above.

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter6: Cash And Receivables
Section: Chapter Questions
Problem 15P: Comprehensive Receivables Problem Blackmon Corporations December 31, 2018, balance sheet disclosed...
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Sign Language Hearing Co Ltd

Comparative Balance Sheet

October 31, 2020, and 2021

 

2021

2020

Assets

 

 

Cash and cash equivalent

     320,000

        275,000

Accounts Receivable

     180,000

        240,000

Prepaid expenses

     240,000

        220,000

Equipment, net

     350,000

        210,000

Total Assets

 1,090,000

        945,000

Liabilities

 

 

Accounts payable

     305,000

        285,000

Accrued liabilities

     285,000

        305,000

Bond payable

     195,000

          95,000

Stockholders' Equity:

 

 

Common Stock

       95,000

          55,000

Retained earnings

     350,000

        255,000

Treasury stock

   (140,000)

         (50,000)

Total liabilities and stockholders' equity

 1,090,000

         945,000

 

 


Sign Language Hearing Co Ltd

Income Statement

Year Ended October 31,2021

Revenues and gains:

 

 

   Sales revenue

     850,000

 

   Gain on sale of equipment

 

 

    Interest revenue

         2,500

 

      Total revenues and gains

 

        852,500

Expenses

 

 

   Cost of goods sold

     465,500

 

   Salary expense

       65,500

 

   Depreciation expense

       24,000

 

   Rent expense

       49,500

 

   Loss on sale of equipment

         2,500

 

      Total expenses

 

        607,000

Income before income taxes

 

        245,500

Income tax expense

 

           38,000

Net Profit

 

        207,500

     
     

 

 

 

 

 

 

Notes

   

Purchase of equipment

 

        243,000

Cash receipt from sale of equipment

 

           76,500

Issuance of bonds payable to borrow cash

 

        100,000

Cash receipt from issuance of common stock

 

           40,000

Dividend paid

 

        112,500

Book value of equipment sold

 

           79,000

Purchase of treasury stock

 

           90,000

  1. Prepare a complete statement of cash flows for October 2021 using the indirect method based on the information and guidance provided above.

 

 

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