MONTY INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016 12/31/17 1
ID: 2394491 • Letter: M
Question
MONTY INC.
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2017 AND 2016
12/31/17
12/31/16
$5,900
$7,000
62,500
51,200
35,300
17,900
39,800
60,100
5,100
3,900
155,200
130,400
(34,700
(25,200
45,500
50,400
$314,600
$295,700
$46,100
$39,900
4,100
6,000
8,000
4,000
8,000
10,100
60,400
69,100
100,000
100,000
30,000
30,000
58,000
36,600
$314,600
$295,700
MONTY INC.
INCOME STATEMENT
FOR THE YEAR ENDING DECEMBER 31, 2017
$340,650
175,900
164,750
121,000
43,750
$11,500
2,000
9,500
34,250
6,850
$27,400
Monty Inc., a greeting card company, had the following statements prepared as of December 31, 2017.MONTY INC.
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2017 AND 2016
12/31/17
12/31/16
Cash$5,900
$7,000
Accounts receivable62,500
51,200
Short-term debt investments (available-for-sale)35,300
17,900
Inventory39,800
60,100
Prepaid rent5,100
3,900
Equipment155,200
130,400
Accumulated depreciation—equipment(34,700
)(25,200
) Copyrights45,500
50,400
Total assets$314,600
$295,700
Accounts payable$46,100
$39,900
Income taxes payable4,100
6,000
Salaries and wages payable8,000
4,000
Short-term loans payable8,000
10,100
Long-term loans payable60,400
69,100
Common stock, $10 par100,000
100,000
Contributed capital, common stock30,000
30,000
Retained earnings58,000
36,600
Total liabilities & stockholders’ equity$314,600
$295,700
MONTY INC.
INCOME STATEMENT
FOR THE YEAR ENDING DECEMBER 31, 2017
$340,650
Cost of goods sold175,900
Gross profit164,750
Operating expenses121,000
Operating income43,750
Interest expense$11,500
Gain on sale of equipment2,000
9,500
Income before tax34,250
Income tax expense6,850
Net income$27,400
Additional information:
1. Dividends in the amount of $6,000 were declared and paid during 2017. 2. Depreciation expense and amortization expense are included in operating expenses. 3. No unrealized gains or losses have occurred on the investments during the year. 4. Equipment that had a cost of $20,200 and was 70% depreciated was sold during 2017.
Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Explanation / Answer
MONTY INC Statement of Cashflows For the year Ended December 31, 2017 Cash flows from operating activities Net Income $27,400.00 Adjustments to reconcile net income to : Depreciation expense $23,640.00 34700-25200+(20200*70%) Amortization expense $4,900.00 50400-45500 Gain on sale of equipment -$2,000.00 Increase in accounts receivable -$11,300.00 Decrease in inventory $20,300.00 Increase in prepaid rent -$1,200.00 Increase in accounts payable $6,200.00 Decrease in income tax payable -$1,900.00 Increase in salaries and wages payable $4,000.00 $42,640.00 Net cash flow from operating activities $70,040.00 Cash flows from investing activities Cash received from sale of equipment $8,060.00 (20200*30%)+2000 Cash paid for Purchase of equipment -$45,000.00 130400-155200-20200 Cash paid for acquisition of short term investment -$17,400.00 Net cash used by investing activities -$54,340.00 Cash flows from financing activities Cash paid for dividend -$6,000.00 Repayment of short term loans payable -$2,100.00 Repayment of long term loan payable -$8,700.00 Net cash flow used by financing activities -$16,800.00 Net increase in cash and cash equivalents -$1,100.00 Cash and cash equivalents at beginning of period $7,000.00 Cash and cash equivalents at end of period $5,900.00
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.