Hunter Company is developing its annual financial statements at December 31, 2013. The statements are complete except
Question:
Hunter Company is developing its annual financial statements at December 31, 2013. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized:
2013 2012
Balance Sheet at December 31
Cash ...................................... $ 44,000 ............ $ 18,000
Accounts Receivable ..................... 27,000 ............. 29,000
Merchandise Inventory ................... 30,000 ............. 36,000
Property and Equipment ................ 111,000 ............ 102,000
Less: Accumulated Depreciation....... (36,000) ........... (30,000)
.............................................. $176,000 ......... $155,000
Accounts Payable ........................ $ 25,000 .......... $ 22,000
Wages Payable ................................. 800 .............. 1,000
Note Payable, Long-Term ................ 38,000 ............. 48,000
Contributed Capital ....................... 80,000 ............. 60,000
Retained Earnings ......................... 32,200 ............. 24,000
.............................................. $176,000 .......... $155,000
Income Statement for 2013
Sales ................................... $100,000
Cost of Goods Sold ................... 61,000
Other Expenses ........................ 27,000
Net Income ........................... $ 12,000
Additional Data:
a. Bought equipment for cash, $9,000.
b. Paid $10,000 on the long-term note payable.
c. Issued new shares of stock for $20,000 cash.
d. Declared and paid a $3,800 cash dividend.
e. Other expenses included depreciation, $6,000; wages, $10,000; taxes, $3,000; other, $8,000.
f. Accounts Payable includes only inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, assume that these expenses were fully paid in cash.
Required:
1. Prepare the statement of cash flows for the year ended December 31, 2013, using the indirect method.
2. Use the statement of cash flows to evaluate Hunter's cash flows?
Financial StatementsFinancial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Accounts Payable
Accounts payable (AP) are bills to be paid as part of the normal course of business.This is a standard accounting term, one of the most common liabilities, which normally appears in the balance sheet listing of liabilities. Businesses receive...
Step by Step Answer:
Given Data HUNTER COMPANY Comparative Balance Sheets and Income Statement For the Years Ended Decemb...View the full answer
Fundamentals of Financial Accounting
ISBN: 978-0078025372
4th edition
Authors: Fred Phillips, Robert Libby, Patricia Libby
