The balance sheet for Clifton Co. as of December 31, 2009 is shown below. During
ID: 2443046 • Letter: T
Question
The balance sheet for Clifton Co. as of December 31, 2009 is shown below.
During 2010 the following occurred:
1. A tract of land was purchased for $22,000.
2. An additional $6,000 in common stock was issued at par.
3. Dividends totaling $9,000 were declared and paid to stockholders.
4. Net income for 2010 was $24,000.
5. Depreciation expense was $15,000.
6. Clifton sold all of its investments (available for sale) at a loss of $7,000.
7. Additional bonds in the amount of $14,000 were issued.
8. At December 31, 2010, Cash was 55,000, Accounts Receivable was $43,000
and Accounts Payable was $13,000.
The worksheet below is provided for your use in posting the 2010 transactions. The
worksheet is not required and will not be graded but it will probably be helpful to you.
Complete the Statement of Cash Flows below and create a Balance Sheet in good form.
Clifton Co.
Statement of Cash Flows Worksheet
December 31, 2009
use
source
of cash
of cash
12-31-09
Dr.
Cr.
12-31-10
Assets
Cash
30,000
Accounts Receivable
29,000
Investments
27,000
Plant Assets
69,000
Land
35,000
190,000
0
Liabilities &
Stockholders Equity
Accounts Payable
29,000
Bonds Payable
45,000
Common Stock
79,000
Retained Earnings
37,000
190,000
0
Clifton Co.
Statement of Cash Flows
For the year ended December 31, 2010
Cash flows from operating activities
Clifton Co.
Balance Sheet
For the year ended December 31, 2010
The balance sheet for Clifton Co. as of December 31, 2009 is shown below.
During 2010 the following occurred:
1. A tract of land was purchased for $22,000.
2. An additional $6,000 in common stock was issued at par.
3. Dividends totaling $9,000 were declared and paid to stockholders.
4. Net income for 2010 was $24,000.
5. Depreciation expense was $15,000.
6. Clifton sold all of its investments (available for sale) at a loss of $7,000.
7. Additional bonds in the amount of $14,000 were issued.
8. At December 31, 2010, Cash was 55,000, Accounts Receivable was $43,000
and Accounts Payable was $13,000.
The worksheet below is provided for your use in posting the 2010 transactions. The
worksheet is not required and will not be graded but it will probably be helpful to you.
Complete the Statement of Cash Flows below and create a Balance Sheet in good form.
Clifton Co.
Statement of Cash Flows Worksheet
December 31, 2009
use
source
of cash
of cash
12-31-09
Dr.
Cr.
12-31-10
Assets
Cash
30,000
Accounts Receivable
29,000
Investments
27,000
Plant Assets
69,000
Land
35,000
190,000
0
Liabilities &
Stockholders Equity
Accounts Payable
29,000
Bonds Payable
45,000
Common Stock
79,000
Retained Earnings
37,000
190,000
0
Clifton Co.
Statement of Cash Flows
For the year ended December 31, 2010
Cash flows from operating activities
Clifton Co.
Balance Sheet
For the year ended December 31, 2010
Explanation / Answer
Clifton Company Statement of cash flows for the year ended December 31,2010 Cash flows from operaiting activities Net Income $24,000 Adjustments to reconcile net income to net cash provided by operating activities: Deprecitation expenses $15,000 Increase in Accounts receivable (net) -14,000 Decrease in accounts payable -16,000 Loss on sale of investments 7,000 Net cash provided by operating activities -8,000 Cash flow from investing activities Purchase of land -22,000 Sale of Investments 20,000 Net cash used by investing activities -2,000 Cash flow from financing activities Payment of cash dividend -9,000 Issuance of common stock 6,000 Issuance of additional bonds 14,000 Net cash provided by financing activities 11,000 Net increase in cash 25,000 Cash at beginning of year 30,000 Cash at end of year 55,000 Clifton company Balance Sheet December 31,2010 Current assets Cash 55,000 Accounts receivable 43,000 Total current assets 98,000 Long-term investments 0 Property,plant, and equipment Land 35,000 Add:Additional purchases 22,000 57,000 Plant Assets 69,000 Less: Depreciation expenses 15,000 54,000 Intangible assets 0 Total assets $2,09,000 Liabilities and Stockholders' Equity Current liabilities Accounts payable 13,000 Long -term debt Bonds payable 45,000 + 14,000 59,000 Total liabilities 72,000 Stockholders' equity Common stock 79,000 Additional common stock issued 6,000 85,000 Retained earnings (37,000-9000+24,000) 52,000 Total stockholders' equity 1,37,000 Total liabilities and stockholders' equity $2,09,000
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