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Golden West College - ACCT G101 A comparative balance sheet, income statement, and additional financial information for Gorni Company appear below: GORNI COMPANY Comparative Balance Sheet December 31 2014 2013 Assets Cash $ 70,000 $ 35,000 Accounts receivable 82,000 53,000 Inventories 120,000 132,000 Prepaid expenses 19,000 25,000 Investments 80,000 65,000 Plant assets 310,000 250,000 Accumulated depreciation (65,000) (60,000) Total $616,000 $500,000 Liabilities and Stockholders' Equity Accounts payable $ 85,000 $ 75,000 Accrued expenses payable 22,000 24,000 Bonds payable 130,000 150,000 Common stock 245,000 170,000 Retained earnings 134,000 81,000 Total $616,000 $500,000 GORNI COMPANY Income Statement For Year Ended December 31, 2014 Sales $480,000 Less: Cost of goods sold $290,000 Operating expenses (excluding depreciation) 60,000 Depreciation expense 17,000 Income taxes 15,000 Interest expense 13,000 Loss on disposal of plant assets 8,000 403,000 Net income $ 77,000 Additional information: New plant assets costing $85,000 were purchased for cash in 2014
Golden West College - ACCT G101
A comparative balance sheet, income statement, and additional financial information for Gorni Company appear below:
GORNI COMPANY
Comparative Balance Sheet December 31
2014 2013
|
|
Assets |
|
||
|
Cash |
$ 70,000 |
$ 35,000 |
||
|
Accounts receivable |
82,000 |
53,000 |
||
|
Inventories |
120,000 |
132,000 |
||
|
Prepaid expenses |
19,000 |
25,000 |
||
|
Investments |
80,000 |
65,000 |
||
|
Plant assets |
310,000 |
250,000 |
||
|
Accumulated depreciation |
(65,000) |
(60,000) |
||
|
Total |
$616,000 |
$500,000 |
||
|
Liabilities and Stockholders' Equity |
||||
|
Accounts payable |
|
$ 85,000 |
$ 75,000 |
|
|
Accrued expenses payable |
|
22,000 |
24,000 |
|
|
Bonds payable |
|
130,000 |
150,000 |
|
|
Common stock |
|
245,000 |
170,000 |
|
|
Retained earnings |
|
134,000 |
81,000 |
|
|
Total |
|
$616,000 |
$500,000 |
|
GORNI COMPANY
Income Statement
For Year Ended December 31, 2014
|
Sales |
|
$480,000 |
|
|
Less: |
|
|
|
|
|
Cost of goods sold |
$290,000 |
|
|
|
Operating expenses (excluding depreciation) |
60,000 |
|
|
|
Depreciation expense |
17,000 |
|
|
|
Income taxes |
15,000 |
|
|
|
Interest expense |
13,000 |
|
|
|
Loss on disposal of plant assets |
8,000 |
403,000 |
Net income $ 77,000
Additional information:
- New plant assets costing $85,000 were purchased for cash in 2014.
- Old plant assets costing $25,000 were sold for $5,000 cash when book value was $13,000.
- Bonds with a face value of $20,000 were converted into $20,000 of common stock.
- A cash dividend of $24,000 was declared and paid during the year.
Instructions: Using the indirect method, prepare in proper financial statement format a statement of cash flows for the year ended December 31, 2014. Use the table on the next page to prepare the statement.
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