Soft Touch Company was started several years ago by two golf instructors. The company's comparative balance sheets and incomestatement are presented below, along with additional information.Balance Sheet at December 31CashAccounts ReceivableEquipmentAccumulated Depreciation-EquipmentTotal AssetsAccounts PayableSalaries and Wages PayableNotes Payable (long-term)Common StockRetained EarningsTotal Liabilities and Stockholders' EquityIncome StatementService RevenueSalaries and Wages ExpenseDepreciation ExpenseIncome Tax ExpenseNet IncomeCurrent Year$ 12,7401,80813,200(2,560)$ 25,188$ 1,1008482,60012,0008,648$ 25,180$ 72,60066,0004601,600$ 4,540Previous Year$ 7,0003,10012,000(2,100)$ 20,000$ 1,6001,3001,00012,0004,100$ 20,000Additional Data:a Bought new golf clubs using cash, $1,200.b. Borrowed $1,600 cash from the bank during the year.c. Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liabilityaccounts relating to income tax, assume that Income Tax Expense was fully paid in cash.Required:1. Prepare the statement of cash flows for the current year ended December 31 using the indirect method. (Amounts to be deductedshould be indicated with a minus sign.)

The cash flow statement is a financial statement used to calculate the inflow and outflow of cash of…

Soft Touch Company was started several years ago by two golf instructors. The company's comparative balance sheets and income statement are presented below, along with additional information. Current Year Previous Year

Soft Touch Company was started several years ago by two golf instructors. The company's comparative balance sheets and income statement are presented below, along with additional information. Current Year Previous Year

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter3: The Basics Of Record Keeping And Financial Statement Preparation: Income Statement

Section: Chapter Questions

Problem 20P

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