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The comparative balance sheet of Merrick Equipment Co. for Dec. 31, 20Y9 and 20Y8, is as follows: Dec. 31, 20Y9 Dec. 31, 20Y8 Assets $ 70,720 $ 47,940 Cash Accounts receivable (net) 207,230 188,190 Inventories 298,520 289,850 102,000 Investments Land 295 800 Equipment. 438,600 358,020 (84,320) $901,680 Accumulated depreciation-equipment (99,110) $1211,760 Totalassets Llabilitles and Stockholders' Equity Accounts payable Accrued expenses payable. Dividends payable.. Common stock, $1 par.. $ 205,700 $194,140 30,600 26,860 25,500 20,400 102,000 202,000 Paid-in capital: Excess of issue price over par-common stock... Retained earnings..... Total liabilities and stockholders'equity.. 354,000 204,000 393,960 $1211,760 354,280 $901,680 The income statement for the year ended December 31, 20Y9, is as follows: Sales $2,023,898 Cost of merchandise sold Gross profit Operating expenses: Depreciation expense Other operating expenses 1,245,476 $ 778,422 $ 14,790 517,299 Total operating expenses. Operating income. Other expenses: 532,089 $ 246,333 Loss on sale of investments (10,200) $ 236,133 Income before income tax Income tax expense Net income.. 94,453 $ 141,680 Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $91,800 cash. d. The common stock was issued for cash. e. There was a $102,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.

The comparative balance sheet of Merrick Equipment Co. for Dec. 31, 20Y9 and 20Y8, is as follows: Dec. 31, 20Y9 Dec. 31, 20Y8 Assets $ 70,720 $ 47,940 Cash Accounts receivable (net) 207,230 188,190 Inventories 298,520 289,850 102,000 Investments Land 295 800 Equipment. 438,600 358,020 (84,320) $901,680 Accumulated depreciation-equipment (99,110) $1211,760 Totalassets Llabilitles and Stockholders' Equity Accounts payable Accrued expenses payable. Dividends payable.. Common stock, $1 par.. $ 205,700 $194,140 30,600 26,860 25,500 20,400 102,000 202,000 Paid-in capital: Excess of issue price over par-common stock... Retained earnings..... Total liabilities and stockholders'equity.. 354,000 204,000 393,960 $1211,760 354,280 $901,680 The income statement for the year ended December 31, 20Y9, is as follows: Sales $2,023,898 Cost of merchandise sold Gross profit Operating expenses: Depreciation expense Other operating expenses 1,245,476 $ 778,422 $ 14,790 517,299 Total operating expenses. Operating income. Other expenses: 532,089 $ 246,333 Loss on sale of investments (10,200) $ 236,133 Income before income tax Income tax expense Net income.. 94,453 $ 141,680 Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $91,800 cash. d. The common stock was issued for cash. e. There was a $102,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The comparative balance sheet of Merrick Equipment Co. for Dec. 31, 20Y9 and 20Y8, is as follows: Dec. 31, 20Y9 Dec. 31, 20Y8 Assets $ 70,720 $ 47,940 Cash Accounts receivable (net) 207,230 188,190 Inventories 298,520 289,850 102,000 Investments Land 295 800 Equipment. 438,600 358,020 (84,320) $901,680 Accumulated depreciation-equipment (99,110) $1211,760 Totalassets Llabilitles and Stockholders' Equity Accounts payable Accrued expenses payable. Dividends payable.. Common stock, $1 par.. $ 205,700 $194,140 30,600 26,860 25,500 20,400 102,000 202,000 Paid-in capital: Excess of issue price over par-common stock... Retained earnings..... Total liabilities and stockholders'equity.. 354,000 204,000 393,960 $1211,760 354,280 $901,680 The income statement for the year ended December 31, 20Y9, is as follows: Sales $2,023,898 Cost of merchandise sold Gross profit Operating expenses: Depreciation expense Other operating expenses 1,245,476 $ 778,422 $ 14,790 517,299 Total operating expenses. Operating income. Other expenses: 532,089 $ 246,333 Loss on sale of investments (10,200) $ 236,133 Income before income tax Income tax expense Net income.. 94,453 $ 141,680 Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $91,800 cash. d. The common stock was issued for cash. e. There was a $102,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.
Transcribed Image Text:The comparative balance sheet of Merrick Equipment Co. for Dec. 31, 20Y9 and 20Y8, is as follows: Dec. 31, 20Y9 Dec. 31, 20Y8 Assets $ 70,720 $ 47,940 Cash Accounts receivable (net) 207,230 188,190 Inventories 298,520 289,850 102,000 Investments Land 295 800 Equipment. 438,600 358,020 (84,320) $901,680 Accumulated depreciation-equipment (99,110) $1211,760 Totalassets Llabilitles and Stockholders' Equity Accounts payable Accrued expenses payable. Dividends payable.. Common stock, $1 par.. $ 205,700 $194,140 30,600 26,860 25,500 20,400 102,000 202,000 Paid-in capital: Excess of issue price over par-common stock... Retained earnings..... Total liabilities and stockholders'equity.. 354,000 204,000 393,960 $1211,760 354,280 $901,680 The income statement for the year ended December 31, 20Y9, is as follows: Sales $2,023,898 Cost of merchandise sold Gross profit Operating expenses: Depreciation expense Other operating expenses 1,245,476 $ 778,422 $ 14,790 517,299 Total operating expenses. Operating income. Other expenses: 532,089 $ 246,333 Loss on sale of investments (10,200) $ 236,133 Income before income tax Income tax expense Net income.. 94,453 $ 141,680 Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $91,800 cash. d. The common stock was issued for cash. e. There was a $102,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.
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