1. During fiscal year 2018, Hoskins Corporation acquired new equipment for $1200 in cash. In addiiton, the company disposed of used equipment that had original cost of $1300 and accumulated depecreciation of $700, receiving $600 in cash from the buyer.2. During fiscal year 2018, Hoskins Corporation arranged short-term bank financing and borrowed $1500, using a portion of the cash to repay all of its outstanding long-term debt.3. During fiscal year 2018, Hoskins Corporation engaged in no transactions involving its common stock, though it did declare and pay in cash a common stock dividend of $250.Prepare a statement of cash flows (all three sections) for Hoskins Corporation’s fiscal year 2018, using the indirect method for the cash from operations section. Income StatementFiscal year2018Sales revenues.Cost of goods sold .Gross profit..Selling, general and administrative expensesDepreciation expense..Operating income .Interest expense...$6,5003,4003,1001,4503501,300350Income before income tax expenseIncome tax expense...950250Net income ...$ 700...... Balance SheetsDecember 31, 2017 December 31, 2018Assets$ 300Cash..Accounts receivableInventory....Prepaid expenses.$ 5506004001,500500400150Current assets..Property, plant, and equipment at cost.Less accumulated depreciation .1,7002,7006,2006,100(2,100)(1,750)4,100$5,800Property, plant, and equipment, net4,350Total assets...$7,050Liabilities and Shareholders' EquityAccounts payable..Income tax payableShort-term debt. .$ 400$ 8002001001,2002,700Current liabilities .1,8003,600Long-term debt..1,000Total liabilities .2,8003,600Contributed capital .Retained earnings8008002,2002,650Total shareholders' equity.3,0003,450Total liabilities and shareholders' equity .$5,800$7,050

Cash flow Statement: It is prepared by the companies. It is a tool in the hands of users of…

Answered: Balance Sheets December 31, 2017…

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter7: Receivables And Investments

Section: Chapter Questions

Problem 7.1DC: Reading 3M Companys Balance Sheet: Accounts Receivable The following current asset appears on the...

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1. During fiscal year 2018, Hoskins Corporation acquired new equipment for $1200 in cash. In addiiton, the company disposed of used equipment that had original cost of $1300 and accumulated depecreciation of $700, receiving $600 in cash from the buyer.

2. During fiscal year 2018, Hoskins Corporation arranged short-term bank financing and borrowed $1500, using a portion of the cash to repay all of its outstanding long-term debt.

3. During fiscal year 2018, Hoskins Corporation engaged in no transactions involving its common stock, though it did declare and pay in cash a common stock dividend of $250.

Prepare a statement of cash flows (all three sections) for Hoskins Corporation’s fiscal year 2018, using the indirect method for the cash from operations section.

Income Statement
Fiscal year
2018
Sales revenues.
Cost of goods sold .
Gross profit..
Selling, general and administrative expenses
Depreciation expense..
Operating income .
Interest expense...
$6,500
3,400
3,100
1,450
350
1,300
350
Income before income tax expense
Income tax expense...
950
250
Net income ...
$ 700
......

Balance Sheets
December 31, 2017 December 31, 2018
Assets
$ 300
Cash..
Accounts receivable
Inventory....
Prepaid expenses.
$ 550
600
400
1,500
500
400
150
Current assets..
Property, plant, and equipment at cost.
Less accumulated depreciation .
1,700
2,700
6,200
6,100
(2,100)
(1,750)
4,100
$5,800
Property, plant, and equipment, net
4,350
Total assets...
$7,050
Liabilities and Shareholders' Equity
Accounts payable..
Income tax payable
Short-term debt. .
$ 400
$ 800
200
100
1,200
2,700
Current liabilities .
1,800
3,600
Long-term debt..
1,000
Total liabilities .
2,800
3,600
Contributed capital .
Retained earnings
800
800
2,200
2,650
Total shareholders' equity.
3,000
3,450
Total liabilities and shareholders' equity .
$5,800
$7,050

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