Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
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Chapter 21, Problem 13P
Comprehensive The following are Farrell Corporation’s balance sheets as of December 31, 2019, and 2018, and the statement of income and
Additional information:
- a. On January 2, 2019, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash.
- b. On April 2, 2019, Farrell issued 1,000 shares of common stock for $23,000 cash.
- c. On May 14, 2019, Farrell sold all of its
treasury stock for $25,000 cash. - d. On June 1, 2019, Farrell paid $50,000 to retire bonds with a face value (and book value) of $50,000.
- e. On July 2, 2019, Farrell purchased equipment for $63,000 cash.
- f. On December 31, 2019. land with a fair market value of $150,000 was purchased through the issuance of a long-term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2021.
- g.
Deferred taxes payable represent temporary differences relating to the use of accelerateddepreciation methods for income tax reporting and the straight-line method for financial statement reporting.
Required:
- 1. Prepare a spreadsheet to support a statement of
cash flows for Farrell for the year ended December 31, 2019, based on the preceding information. - 2. Prepare the statement of cash flows.
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Chapter 21 Solutions
Intermediate Accounting: Reporting And Analysis
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