Condensed financial data of Sinjh Inc. follow. SINJH INC. Comparative Balance Sh
ID: 2496658 • Letter: C
Question
Condensed financial data of Sinjh Inc. follow.
SINJH INC.
Comparative Balance Sheets
December 31
Assets
2014
2013
$111,000
$47,800
91,090
33,180
111,120
102,130
29,740
25,120
139,920
114,390
265,580
242,340
(47,360
)
(52,240
)
$701,090
$512,720
Liabilities and Stockholders’ Equity
$111,880
$67,080
16,250
17,250
117,330
149,380
219,430
175,480
236,200
103,530
$701,090
$512,720
SINJH INC.
Income Statement
For the Year Ended December 31, 2014
134,180
12,060
46,120
26,870
4,160
$175,240
Additional information:
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).)
SINJH INC.
Comparative Balance Sheets
December 31
Assets
2014
2013
Cash$111,000
$47,800
Accounts receivable91,090
33,180
Inventory111,120
102,130
Prepaid expenses29,740
25,120
Long-term investments139,920
114,390
Plant assets265,580
242,340
Accumulated depreciation(47,360
)
(52,240
)
Total$701,090
$512,720
Liabilities and Stockholders’ Equity
Accounts payable$111,880
$67,080
Accrued expenses payable16,250
17,250
Bonds payable117,330
149,380
Common stock219,430
175,480
Retained earnings236,200
103,530
Total$701,090
$512,720
Explanation / Answer
Cash flows from operating activities Net income $175,240 Adjustments for: Depreciation and amortization 46,120 Profit on sale of plant -7,180 38,940 Increase in account receivable -57,910 increase in inventory -8,990 Increase in prepaid expenses -4,620 Increase in account payable 44,800 Decrease in Accrued expenses payable -1,000 -27,720 Cash generated from operations 186,460 Cash flows from investing activities Purchase of new plant -79,860 Proceeds from sale of plant 12,800 Purchase of long term investment (25,530) Net cash used in investing activities -92,590 Cash flows from financing activities Proceeds from issue of common stock 43,950 Payment of bonds payable -32,050 Dividends paid -42,570 Net cash used in financing activities -30,670 Net increase in cash and cash equivalents 63,200 Cash and cash equivalents at beginning of period 47,800 Cash and cash equivalents at end of period $111,000 Note: sale of old plant: Original cost 56,620 Less: accumulated depreciation 51,000 WDV of plant 5,620 Sale price 12,800 Profit on sale of plant 7,180
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