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Dec. 31, 20Y6 Dec. 31, 20Y5 Assets $ 643,400 $ 679,400 547,400 Cash ...... Accounts receivable (net) 566,800 Inventories 1,011,000 982,800 Investments 240,000 Land.... 520,000 880,000| Equipment.... 680,000 Accumulated depreciation.. (244,400) (200,400) Total assets. $3,376,800 $2,929,200 Liabilities and Stockholders'Equity Accounts payable ..... Accrued expenses payable. Dividends payable..... Common stock, $2 par.. $ 771,800 $ 748,400 70,800 63,400 8,800 6,400 56,000 32,000 Paid-in capital: Excess of issue price over par-common stock.... Retained earnings....... Total liabilities and stockholders'equity. 408,000 192,000 1,879,600 2,068,800 $3,376,800 $2,929,200 The income statement for the year ended December 31, 20Y6, is as follows: Sales ...... $5,980,000 Cost of merchandise sold 2,452,000 Gross profit...... Operating expenses: Depreciation expense Other operating expenses Total operating expenses . $3,528,000 $ 44,000 3,100,000 3,144,000 $ 384,000 Operating income.. Other expense: Loss on sale of investments .. (64,000) $ 320,000 Income before income tax Income tax expense .. 102,800 $ 217,200 Net income..... Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $176,000 cash. d. The common stock was issued for cash. e. There was a $28,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.

Dec. 31, 20Y6 Dec. 31, 20Y5 Assets $ 643,400 $ 679,400 547,400 Cash ...... Accounts receivable (net) 566,800 Inventories 1,011,000 982,800 Investments 240,000 Land.... 520,000 880,000| Equipment.... 680,000 Accumulated depreciation.. (244,400) (200,400) Total assets. $3,376,800 $2,929,200 Liabilities and Stockholders'Equity Accounts payable ..... Accrued expenses payable. Dividends payable..... Common stock, $2 par.. $ 771,800 $ 748,400 70,800 63,400 8,800 6,400 56,000 32,000 Paid-in capital: Excess of issue price over par-common stock.... Retained earnings....... Total liabilities and stockholders'equity. 408,000 192,000 1,879,600 2,068,800 $3,376,800 $2,929,200 The income statement for the year ended December 31, 20Y6, is as follows: Sales ...... $5,980,000 Cost of merchandise sold 2,452,000 Gross profit...... Operating expenses: Depreciation expense Other operating expenses Total operating expenses . $3,528,000 $ 44,000 3,100,000 3,144,000 $ 384,000 Operating income.. Other expense: Loss on sale of investments .. (64,000) $ 320,000 Income before income tax Income tax expense .. 102,800 $ 217,200 Net income..... Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $176,000 cash. d. The common stock was issued for cash. e. There was a $28,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.

FINANCIAL ACCOUNTING
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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The comparative balance sheet of Canace Products Inc. for December 31, 20Y6 and 20Y5, is as follows:

Dec. 31, 20Y6 Dec. 31, 20Y5 Assets $ 643,400 $ 679,400 547,400 Cash ...... Accounts receivable (net) 566,800 Inventories 1,011,000 982,800 Investments 240,000 Land.... 520,000 880,000| Equipment.... 680,000 Accumulated depreciation.. (244,400) (200,400) Total assets. $3,376,800 $2,929,200 Liabilities and Stockholders'Equity Accounts payable ..... Accrued expenses payable. Dividends payable..... Common stock, $2 par.. $ 771,800 $ 748,400 70,800 63,400 8,800 6,400 56,000 32,000 Paid-in capital: Excess of issue price over par-common stock.... Retained earnings....... Total liabilities and stockholders'equity. 408,000 192,000 1,879,600 2,068,800 $3,376,800 $2,929,200 The income statement for the year ended December 31, 20Y6, is as follows: Sales ...... $5,980,000 Cost of merchandise sold 2,452,000 Gross profit...... Operating expenses: Depreciation expense Other operating expenses Total operating expenses . $3,528,000 $ 44,000 3,100,000 3,144,000
Transcribed Image Text:Dec. 31, 20Y6 Dec. 31, 20Y5 Assets $ 643,400 $ 679,400 547,400 Cash ...... Accounts receivable (net) 566,800 Inventories 1,011,000 982,800 Investments 240,000 Land.... 520,000 880,000| Equipment.... 680,000 Accumulated depreciation.. (244,400) (200,400) Total assets. $3,376,800 $2,929,200 Liabilities and Stockholders'Equity Accounts payable ..... Accrued expenses payable. Dividends payable..... Common stock, $2 par.. $ 771,800 $ 748,400 70,800 63,400 8,800 6,400 56,000 32,000 Paid-in capital: Excess of issue price over par-common stock.... Retained earnings....... Total liabilities and stockholders'equity. 408,000 192,000 1,879,600 2,068,800 $3,376,800 $2,929,200 The income statement for the year ended December 31, 20Y6, is as follows: Sales ...... $5,980,000 Cost of merchandise sold 2,452,000 Gross profit...... Operating expenses: Depreciation expense Other operating expenses Total operating expenses . $3,528,000 $ 44,000 3,100,000 3,144,000
$ 384,000 Operating income.. Other expense: Loss on sale of investments .. (64,000) $ 320,000 Income before income tax Income tax expense .. 102,800 $ 217,200 Net income..... Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $176,000 cash. d. The common stock was issued for cash. e. There was a $28,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.
Transcribed Image Text:$ 384,000 Operating income.. Other expense: Loss on sale of investments .. (64,000) $ 320,000 Income before income tax Income tax expense .. 102,800 $ 217,200 Net income..... Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $176,000 cash. d. The common stock was issued for cash. e. There was a $28,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities.
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