The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Wright Company. Additional information from Wright's accounting records is provided also. WRIGHT COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands) 2021 2020 Assets Cash $ 79 $ 40 Accounts receivable 83 85 Short-term investment 33 12 Inventory 83 80 Land 58 70 Buildings and equipment 525 420 Less: Accumulated depreciation (127 ) (85 ) $ 734 622 Liabilities Accounts payable $ 29 $ 37 Salaries payable 4 7 Interest payable 4 2 Income tax payable 6 11 Notes payable 0 21 Bonds payable 162 120 Shareholders’ Equity Common stock 265 220 Paid-in capital—excess of par 145 110 Retained earnings 119 94 $ 734 $ 622 WRIGHT COMPANY Income Statement For Year Ended December 31, 2021 ($ in thousands) Revenues: Sales revenue $ 370 Expenses: Cost of goods sold $ 150 Salaries expense 49 Depreciation expense 42 Interest expense 11 Loss on sale of land 6 Income tax expense 52 310 Net income $ 60 Additional information from the accounting records: Land that originally cost $12,000 was sold for $6,000. The common stock of Microsoft Corporation was purchased for $21,000 as a short-term investment not classified as a cash equivalent. New equipment was purchased for $105,000 cash. A $21,000 note was paid at maturity on January 1. On January 1, 2021, bonds were sold at their $42,000 face value. Common stock ($45,000 par) was sold for $80,000. Net income was $60,000 and cash dividends of $35,000 were paid to shareholders. Required: Prepare the statement of cash flows of Wright Company for the year ended December 31, 2021. Present cash flows from operating activities by the direct method. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands (i.e., 10,000 should be entered as 10).)

The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Wright Company. Additional information from Wright's accounting records is provided also. WRIGHT COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands) 2021 2020 Assets Cash $ 79 $ 40 Accounts receivable 83 85 Short-term investment 33 12 Inventory 83 80 Land 58 70 Buildings and equipment 525 420 Less: Accumulated depreciation (127 ) (85 ) $ 734 622 Liabilities Accounts payable $ 29 $ 37 Salaries payable 4 7 Interest payable 4 2 Income tax payable 6 11 Notes payable 0 21 Bonds payable 162 120 Shareholders’ Equity Common stock 265 220 Paid-in capital—excess of par 145 110 Retained earnings 119 94 $ 734 $ 622 WRIGHT COMPANY Income Statement For Year Ended December 31, 2021 ($ in thousands) Revenues: Sales revenue $ 370 Expenses: Cost of goods sold $ 150 Salaries expense 49 Depreciation expense 42 Interest expense 11 Loss on sale of land 6 Income tax expense 52 310 Net income $ 60 Additional information from the accounting records: Land that originally cost $12,000 was sold for $6,000. The common stock of Microsoft Corporation was purchased for $21,000 as a short-term investment not classified as a cash equivalent. New equipment was purchased for $105,000 cash. A $21,000 note was paid at maturity on January 1. On January 1, 2021, bonds were sold at their $42,000 face value. Common stock ($45,000 par) was sold for $80,000. Net income was $60,000 and cash dividends of $35,000 were paid to shareholders. Required: Prepare the statement of cash flows of Wright Company for the year ended December 31, 2021. Present cash flows from operating activities by the direct method. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands (i.e., 10,000 should be entered as 10).)

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 55PSA

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Question

The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Wright Company. Additional information from Wright's accounting records is provided also.

WRIGHT COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands)
	2021		2020
Assets
Cash	$	79		$	40
Accounts receivable		83			85
Short-term investment		33			12
Inventory		83			80
Land		58			70
Buildings and equipment		525			420
Less: Accumulated depreciation		(127	)		(85	)
	$	734			622
Liabilities
Accounts payable	$	29		$	37
Salaries payable		4			7
Interest payable		4			2
Income tax payable		6			11
Notes payable		0			21
Bonds payable		162			120
Shareholders’ Equity
Common stock		265			220
Paid-in capital—excess of par		145			110
Retained earnings		119			94
	$	734		$	622

WRIGHT COMPANY Income Statement For Year Ended December 31, 2021 ($ in thousands)
Revenues:
Sales revenue			$	370
Expenses:
Cost of goods sold	$	150
Salaries expense		49
Depreciation expense		42
Interest expense		11
Loss on sale of land		6
Income tax expense		52		310
Net income			$	60

Additional information from the accounting records:

Land that originally cost $12,000 was sold for $6,000.
The common stock of Microsoft Corporation was purchased for $21,000 as a short-term investment not classified as a cash equivalent.
New equipment was purchased for $105,000 cash.
A $21,000 note was paid at maturity on January 1.
On January 1, 2021, bonds were sold at their $42,000 face value.
Common stock ($45,000 par) was sold for $80,000.
Net income was $60,000 and cash dividends of $35,000 were paid to shareholders.

Required:
Prepare the statement of cash flows of Wright Company for the year ended December 31, 2021. Present cash flows from operating activities by the direct method. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands (i.e., 10,000 should be entered as 10).)

WRIGHT COMPANY
Statement of Cash Flows
For the year ended December 31, 2021
($ in thousands)
Cash flows from operating activities:
Cash inflows:

Cash outflows:






Net cash flows from operating activities.		$0
Cash flows from investing activities:






Net cash flows from investing activities		0
Cash flows from financing activities:






Net cash flows from financing activities		0
Net increase (decrease) in cash
Cash balance, January 1
Cash balance, December 31		$0

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