XS Supply Company is developing its annual financial statements at December 31,
ID: 2368331 • Letter: X
Question
XS Supply Company is developing its annual financial statements at December 31, 2010. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized: 2010 2009 Balance Sheet at December 31 Cash $ 35,600 $ 30,000 Accounts Receivable 34,400 29,300 Merchandise Inventory 39,600 36,900 Property and Equipment 121,800 101,900 Less: Accumulated Depreciation (29,600 ) (24,800 ) $ 201,800 $ 173,300 Accounts Payable $ 35,800 $ 29,000 Wages Payable 1,150 1,500 Note Payable, Long?Term 38,700 42,300 Contributed Capital 90,050 76,600 Retained Earnings 36,100 23,900 $ 201,800 $ 173,300 Income Statement for 2010 Sales $ 120,600 Cost of Goods Sold 69,800 Other Expenses 38,600 Net Income $ 12,200 Additional Data: a. Bought equipment for cash, $19,900. b. Paid $3,600 on the long?term note payable. c. Issued new shares of stock for $13,450 cash. d. No dividends were declared or paid. e. Other expenses included depreciation, $4,800; wages, $20,500; taxes, $5,600; other, $7,700. f. Accounts payable includes only inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, assume that these expenses were fully paid in cash. Prepare the statement of cash flows for the year ended December 31, 2010, using the indirect methodExplanation / Answer
Hi, Only Straight Line Method is mentioned in the question. So I am providing details for that only. Annual Depreciation for Each Year would be: = (48000-4000)/5 = 8800 Accumulated Depreciation Year 1 = 8800 Year 2 = 17600 Year 3 = 26400 Year 4 = 35200 Year 5 = 44000 Book Value Year 1 = 44000 - 8800 = 35200 Year 2 = 44000 - 17600 = 26400 Year 3 = 44000 - 26400 = 17600 Year 4 = 44000 - 35200 = 8800 Year 5 = 44000 - 44000 = 0 Thanks.
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