Pronghorn Inc., a retailer of garden tools that follows ASPE, had the following statements prepared as...
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Pronghorn Inc., a retailer of garden tools that follows ASPE, had the following statements prepared as of December 31, 2023: PRONGHORN Inc. Comparative Statement of Financial Position December 31 2023 2022 Cash $58,374 $53,800 Accounts receivable 58,100 51,800 Inventory 42,800 72,500 Prepaid rent 6,200 4,000 Equipment 168,000 129,000 Accumulated depreciation-equipment (34,000) (25,900) Total assets $299,474 $285,200 Accounts payable $50,950 $35,000 Income tax payable 4,000 6,200 Long-term loans payable 60,000 70,000 Common shares 126,550 126,550 Retained earnings 57,974 47,450 Total liabilities and shareholders' equity $299,474 $285,200 PRONGHORN Inc. Income Statement Year Ended December 31, 2023 Sales revenue Cost of goods sold Gross margin $386,000 212,000 174,000 Operating expenses 121,600 Operating income 52,400 Interest expense $11,700 Gain on disposal of equipment (3,000) 8,700 Income before income tax 43,700 Income tax expense 20,976 Net income $22,724 Additional information: 1. Dividends on common shares in the amount of $12,200 were declared and paid during 2023. 2. Depreciation expense of $22,450 is included in operating expenses. 3. Equipment with a cost of $20,500 that was 70% depreciated was sold during 2023. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) PRONGHORN Inc. Statement of Cash Flows (Indirect Method) Adjustments to reconcile net income to net cash provided by operating activities: Pronghorn Inc., a retailer of garden tools that follows ASPE, had the following statements prepared as of December 31, 2023: PRONGHORN Inc. Comparative Statement of Financial Position December 31 2023 2022 Cash $58,374 $53,800 Accounts receivable 58,100 51,800 Inventory 42,800 72,500 Prepaid rent 6,200 4,000 Equipment 168,000 129,000 Accumulated depreciation-equipment (34,000) (25,900) Total assets $299,474 $285,200 Accounts payable $50,950 $35,000 Income tax payable 4,000 6,200 Long-term loans payable 60,000 70,000 Common shares 126,550 126,550 Retained earnings 57,974 47,450 Total liabilities and shareholders' equity $299,474 $285,200 PRONGHORN Inc. Income Statement Year Ended December 31, 2023 Sales revenue Cost of goods sold Gross margin $386,000 212,000 174,000 Operating expenses 121,600 Operating income 52,400 Interest expense $11,700 Gain on disposal of equipment (3,000) 8,700 Income before income tax 43,700 Income tax expense 20,976 Net income $22,724 Additional information: 1. Dividends on common shares in the amount of $12,200 were declared and paid during 2023. 2. Depreciation expense of $22,450 is included in operating expenses. 3. Equipment with a cost of $20,500 that was 70% depreciated was sold during 2023. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) PRONGHORN Inc. Statement of Cash Flows (Indirect Method) Adjustments to reconcile net income to net cash provided by operating activities:
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Related Book For
Intermediate Accounting Volume 1
ISBN: 978-1119496496
12th Canadian edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Irene M. Wiecek, Bruce J. McConomy
Posted Date:
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