Diane's balance sheets as of December 31, 2016 and 2017 are presented below: 2016 310,000 300,000 0 2017 $443,456 430,000 100,000 17,356) 950,000 ( 318.100) $1.588.000 Cash Accounts receivable, net Long-term notes receivable Discount on long-term notes receivable Property, plant, and equipment at cost Accumulated depreciation 0) 750,000 325,000) $1035.000 TOTAL ASSETS 230,000 220,000 25,000 60,000 200,000 300,000 $1035.000 $175,000 310,000 15,000 110,000 315,000 663,000 $1.588.000 Accrued liabilities Unearned revenues Short-term debt Common stock, $1 par value Additional paid-in-capital Retained earnings TOTAL LIABILITIES & SE Diane's 2017 income statement is presented below: Service revenues Other revenues and gains/losses, net Selling, general, and administrative expenses Interest expense $1,800,000 1,987 1,209,000 1,000 588,013 125,013 463.000 Income before income taxes Income tax expense Net income SELECTED OTHER INFORMATION: 1 On January 1,2017, Diane provided services to a customer in exchange for a $100,000, zero interest bearing note receivable. Diane will collect the note principal in full on January 1, 2020. The market rate of interest at the time of the sale was 10% 2 During 2017, all other services provided by Diane were on a cash or short-term credit (AR) basis. 3. ributed a cash dividend During 2017, Diane declared and During 2017, Diane issued, in exchange for cash, 50,000 additional shares of her common stock 4 5 During 2017, Diane both bought and sold some PP&E. Diane uses the straight-line depreciation method on all of its PP&E items and calculates depreciation to the nearest full-month. Diane assumes a $0 salvage value on each PP&E item. Diane's PP&E sales related to two items: A machine. Diane purchased the machine on 06-01-14 for $86,400. The machine had an eight-year useful life. Diane sold the machine on 11-01-17 for $45,000. A building. When Diane purchased the building, she paid $100,000. Diane sold the building for $20,000. As a result of the sale, Diane recorded a loss of $5,000 а. b. During 2017, Diane did NOT enter into any non-cash investing or financing activities 6 Prepare Diane's Statement of Cash Flows (in good form) for the year ended December 31, 2017. Diane uses the indirect method.
Diane's balance sheets as of December 31, 2016 and 2017 are presented below: 2016 310,000 300,000 0 2017 $443,456 430,000 100,000 17,356) 950,000 ( 318.100) $1.588.000 Cash Accounts receivable, net Long-term notes receivable Discount on long-term notes receivable Property, plant, and equipment at cost Accumulated depreciation 0) 750,000 325,000) $1035.000 TOTAL ASSETS 230,000 220,000 25,000 60,000 200,000 300,000 $1035.000 $175,000 310,000 15,000 110,000 315,000 663,000 $1.588.000 Accrued liabilities Unearned revenues Short-term debt Common stock, $1 par value Additional paid-in-capital Retained earnings TOTAL LIABILITIES & SE Diane's 2017 income statement is presented below: Service revenues Other revenues and gains/losses, net Selling, general, and administrative expenses Interest expense $1,800,000 1,987 1,209,000 1,000 588,013 125,013 463.000 Income before income taxes Income tax expense Net income SELECTED OTHER INFORMATION: 1 On January 1,2017, Diane provided services to a customer in exchange for a $100,000, zero interest bearing note receivable. Diane will collect the note principal in full on January 1, 2020. The market rate of interest at the time of the sale was 10% 2 During 2017, all other services provided by Diane were on a cash or short-term credit (AR) basis. 3. ributed a cash dividend During 2017, Diane declared and During 2017, Diane issued, in exchange for cash, 50,000 additional shares of her common stock 4 5 During 2017, Diane both bought and sold some PP&E. Diane uses the straight-line depreciation method on all of its PP&E items and calculates depreciation to the nearest full-month. Diane assumes a $0 salvage value on each PP&E item. Diane's PP&E sales related to two items: A machine. Diane purchased the machine on 06-01-14 for $86,400. The machine had an eight-year useful life. Diane sold the machine on 11-01-17 for $45,000. A building. When Diane purchased the building, she paid $100,000. Diane sold the building for $20,000. As a result of the sale, Diane recorded a loss of $5,000 а. b. During 2017, Diane did NOT enter into any non-cash investing or financing activities 6 Prepare Diane's Statement of Cash Flows (in good form) for the year ended December 31, 2017. Diane uses the indirect method.
Chapter9: Accounting For Receivables
Section: Chapter Questions
Problem 22MC: A company collects an honored note with a maturity date of 24 months from establishment, a 10%...
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