ncome Statement For the Year Ended December 31, 202 Statement of Retained Laming

Question

ncome Statement For the Year Ended December 31, 202 Statement of Retained Lamings For the Year Ended December 31, 20x2 Sales Gostofgoods sold S 3,000,000 544,000 Rctained carnings, balance, Janunry 1,2002 $730000 Add Eamngs availableto common stockholders, 202 120000 Gross pront Selling andadministrative expanse Depreciation expens8 50,000 00,000 Deduct: Cash dvidends dedlarcdandpaid in20x2 Retained earnings, balance, December 31,202 750000 Interest experse S 200,000 Earnings after taxes Comparative Balance Sheets For 20X2 and 20X1 2002 20x1 Currentassets Cash Accountsrecevade (ne) 5 50,000 350,000 300,000 S 55.000 315.000 215,000 Prepaid experses Total current assets 700,000 S 610,000 Gross plant and cquipment Less: Accumulated deprecistion Net plantand cquipmem S1,800,000 500,000 51,470,000 1,070,000 $1,680 000 Tatal assets 2000 000 Currentliabilties Accounts payable Notes payatle S 0,000 100,000 140,000 S 30,000 60.000 130.000 Total currentliabiities Long-term liabilities Bonds payabe, 20K2 Total liabilities 800,000 680.000 Slockholders' equty Preferred stock, $100 parvalue Commonstock S1 par value Capital paid in excess ofpar Retained earnings Total stockhoders equty 50,000 100,000 50,000 60.000 100.000 30.000 Total liabilities and stockholders equity S 2,000,000 S1,680,000 Statement of Cash Flows For the Year Ended December 31, 2OX2 Cash lows from operating actvties: Net income Adjustments to determine cashflow from operating adivities Add back depreciation Totals nts recelvable in inventory n prepaid exDenSe5 n accounts payable in accrued expenses otal ustments Net cash lows from operating activties Cash nows from investing activities: plant and equipmenlt Net cash ows from investing activiies Cash nows from financing actMbes: bonds payable Preferred stock dividends paid Common sock dividends paid Net cash lows from finanding actMties Net change in cash

Explanation / Answer

Statement of Cash flows For the Year Ended December 31, 20X2 Cash flows from Operating activities: Net income 120000 Adjustements to determine cash flows from operating activities Add back deprecaition 100000 Increase in Accounts receivable -35000 Increase in Inventory -85000 Decrease in Prepaid expenses 25000 Increase in Accounts Payable 30000 Increase in notes Payable 40000 Increase in accrued Expenses 10000 Total Adjustments 85000 Net cash flows from operating activities 205000 Cash flows from investing activities: Purchase of Plant and Equipment -330000 Net cash flows from investing activities -330000 Cash flows from financing activities: Proceeds from issue of bonds payable 220000 Preferred stock dividends paid 0 Common stock dividends paid -100000 Net cash flows from financing activities 120000 Net Change in Cash -5000

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