2020 2019 Account Description Debit Debit Cash 43,700 18,200 Accounts Receivable 24,500 13,377 Allowance for doubtful accounts (900) (427) Inventory 44,200 35,000 Prepaid expenses 15,100 12,900 Supplies 1,000 750 Investments 132,200 157,000 Property, plant, and equipment: Land 125,000 175,000 Buildings 350,000 350,000 Less: Accumulated depreciation - buildings (105,000) (87,500) Equipment 525,000 400,000 Less: Accumulated depreciation - equipment (130,000) (112,000) Patents 45,000 50,000 Accounts Payable (20,000) (32,000) Income Tax Payable (6,000) (4,000) Salaries and Wages Payable (8,100) (5,800) Dividend Payable (16,500) (14,400) Short term Notes Payable (10,000) (10,000) Long term notes payable (60,000) (70,000) Bonds Payable (400,000) (400,000) Add: Premium on bonds payable (20,303) (25,853) Shareholders' equity: Common Stock, $10 par, outstanding 2020 2.4 million shares, and 2019 2.2 million shares (240,000) (220,000) Paind in capital in excess of par - common stock (25,000) (17,500) Retained Earnings (212,747) (148,711) Dividends 28,800 33,000 Sales (1,160,000) (1,290,000) Cost of Goods Sold 748,000 786,900 Sales salaries expense 48,000 62,500 Sales benefit expense 15,400 20,000 Advertising 13,500 18,000 Sales travel expense 2,000 2,200 Sales supplies expense 300 350 Sales depreciation expense 13,400 15,200 Admin salaries expense 105,600 110,800 Admin benefits expense 42,250 45,650 Admin travel expense 4,200 4,350 Admin supplies expense 1,450 1,320 Admin maintenance expense 3,200 5,000 Admin maintenance expense 3,200 5,000 Admin depreciation expense 22,100 25,800 Gain on sale of plant assets (8,000) - Gain on sale of long term investments (4,000) Loss on sale of long term investments - 8,400 Dividend revenue (2,400) (2,600) Interest expense 32,450 33,450 Income tax expense 39,400 50,644 Using the trial balance above complete a Statement of Cash Flows for 2020. Use the indirect method. See additional information below. *During 2020 15% of total sales were credit sales Gain on sale of plant assets is related to the Land transaction. Decrease in the patent value is due to an impairment New equipment was purchased. Common stock was issued on 9/1/2020. Common stock was issued on 9/1/2020. Net Income for 2020 is $79,950.

2020 2019 Account Description Debit Debit Cash 43,700 18,200 Accounts Receivable 24,500 13,377 Allowance for doubtful accounts (900) (427) Inventory 44,200 35,000 Prepaid expenses 15,100 12,900 Supplies 1,000 750 Investments 132,200 157,000 Property, plant, and equipment: Land 125,000 175,000 Buildings 350,000 350,000 Less: Accumulated depreciation - buildings (105,000) (87,500) Equipment 525,000 400,000 Less: Accumulated depreciation - equipment (130,000) (112,000) Patents 45,000 50,000 Accounts Payable (20,000) (32,000) Income Tax Payable (6,000) (4,000) Salaries and Wages Payable (8,100) (5,800) Dividend Payable (16,500) (14,400) Short term Notes Payable (10,000) (10,000) Long term notes payable (60,000) (70,000) Bonds Payable (400,000) (400,000) Add: Premium on bonds payable (20,303) (25,853) Shareholders' equity: Common Stock, $10 par, outstanding 2020 2.4 million shares, and 2019 2.2 million shares (240,000) (220,000) Paind in capital in excess of par - common stock (25,000) (17,500) Retained Earnings (212,747) (148,711) Dividends 28,800 33,000 Sales (1,160,000) (1,290,000) Cost of Goods Sold 748,000 786,900 Sales salaries expense 48,000 62,500 Sales benefit expense 15,400 20,000 Advertising 13,500 18,000 Sales travel expense 2,000 2,200 Sales supplies expense 300 350 Sales depreciation expense 13,400 15,200 Admin salaries expense 105,600 110,800 Admin benefits expense 42,250 45,650 Admin travel expense 4,200 4,350 Admin supplies expense 1,450 1,320 Admin maintenance expense 3,200 5,000 Admin maintenance expense 3,200 5,000 Admin depreciation expense 22,100 25,800 Gain on sale of plant assets (8,000) - Gain on sale of long term investments (4,000) Loss on sale of long term investments - 8,400 Dividend revenue (2,400) (2,600) Interest expense 32,450 33,450 Income tax expense 39,400 50,644 Using the trial balance above complete a Statement of Cash Flows for 2020. Use the indirect method. See additional information below. *During 2020 15% of total sales were credit sales Gain on sale of plant assets is related to the Land transaction. Decrease in the patent value is due to an impairment New equipment was purchased. Common stock was issued on 9/1/2020. Common stock was issued on 9/1/2020. Net Income for 2020 is $79,950.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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	2020	2019
Account Description	Debit	Debit
Cash	43,700	18,200
Accounts Receivable	24,500	13,377
Allowance for doubtful accounts	(900)	(427)
Inventory	44,200	35,000
Prepaid expenses	15,100	12,900
Supplies	1,000	750
Investments	132,200	157,000
Property, plant, and equipment:
Land	125,000	175,000
Buildings	350,000	350,000
Less: Accumulated depreciation - buildings	(105,000)	(87,500)
Equipment	525,000	400,000
Less: Accumulated depreciation - equipment	(130,000)	(112,000)
Patents	45,000	50,000
Accounts Payable	(20,000)	(32,000)
Income Tax Payable	(6,000)	(4,000)
Salaries and Wages Payable	(8,100)	(5,800)
Dividend Payable	(16,500)	(14,400)
Short term Notes Payable	(10,000)	(10,000)
Long term notes payable	(60,000)	(70,000)
Bonds Payable	(400,000)	(400,000)
Add: Premium on bonds payable	(20,303)	(25,853)
Shareholders' equity:
Common Stock, $10 par, outstanding 2020 2.4 million shares, and 2019 2.2 million shares	(240,000)	(220,000)
Paind in capital in excess of par - common stock	(25,000)	(17,500)
Retained Earnings	(212,747)	(148,711)
Dividends	28,800	33,000

Sales	(1,160,000)	(1,290,000)
Cost of Goods Sold	748,000	786,900
Sales salaries expense	48,000	62,500
Sales benefit expense	15,400	20,000
Advertising	13,500	18,000
Sales travel expense	2,000	2,200
Sales supplies expense	300	350
Sales depreciation expense	13,400	15,200
Admin salaries expense	105,600	110,800
Admin benefits expense	42,250	45,650
Admin travel expense	4,200	4,350
Admin supplies expense	1,450	1,320
Admin maintenance expense	3,200	5,000
Admin maintenance expense	3,200	5,000
Admin depreciation expense	22,100	25,800
Gain on sale of plant assets	(8,000)	-
Gain on sale of long term investments	(4,000)
Loss on sale of long term investments	-	8,400
Dividend revenue	(2,400)	(2,600)
Interest expense	32,450	33,450
Income tax expense	39,400	50,644

Using the trial balance above complete a Statement of Cash Flows for 2020. Use the indirect method. See additional information below.

*During 2020 15% of total sales were credit sales

Gain on sale of plant assets is related to the Land transaction.

Decrease in the patent value is due to an impairment

New equipment was purchased.

Common stock was issued on 9/1/2020.

Net Income for 2020 is $79,950.

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