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2021 2020 $ $ 978,000 (1,850) Sales Sales return Net Sales Cost of Goods Sold Gross Profit $ 976,150 391,000 585,150 925,000 (1,500) $ 923,500

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2021 2020 $ $ 978,000 (1,850) Sales Sales return Net Sales Cost of Goods Sold Gross Profit $ 976,150 391,000 585,150 925,000 (1,500) $ 923,500 380,000 543,500 Operating Expenses Wages Expense Depreciation Expense Utilities Expense Insurance Expense Rent Expense Advertising Expense Amortization Expense Bad Debts Expense Supplies Expense Total Operating Expense Income From Operations Other Revenue Gain on Sale of Assets Interest Income Dividend Income (153,300) (140,250) (70,150) (42,000) (41,000) (15,000) (12,000) (9,780) (7,000) (144,000) (135,500) (69,150) (35,000) (39,000) (12,000) (9,250) (9,000) (490,480) 94,670 (452,900) 90,600 8,750 3,000 2,000 7,500 2,500 13,750 108,420 10,000 100,600 Other Expenses Interest Expense Loss from Early Retirement of Debt (36,000) (32,000) (5,000) Income Before Income Tax Income Tax Expense (30% for 2021, 25% for 2020) Net Income (36,000) 72,420 (21,726) 50,694 (37,000) 63,600 (15,900) 47,700 $ $ Earnings Per Share on Net Income 50694/50500 $ 1.00 47700/49250 $ 0.97 50500 Dec 31.21 Jan. 1.21 50,000 X 12/12 = 50,000 Oct. 1. 212,000 X 3/12 = 500 Jan.1.20 Apr.4.20 Dec.31.20 47000*12/12 3000*9/12 50000 47000 2250 49250 2021 2020 Assets Current Assets Cash Accounts Receivable Allowance for Doubtful Accounts Merchandise Inventory Supplies Prepaid Insurance Total Current Assets 99,400 126,720 (3,600) $ 258,100 1,400 5,700 80,250 143,000 (3,000) $ 241,500 1,000 5,500 $ 487,720 $ 468,250 Investments and Funds Building Fund Available for Sale Securities Total Investments and Funds 80,000 61,000 22,650 141,000 22,650 Fixed Assets Equipment Accumulated Depreciation-Equipment Land Total Fixed Assets 983,000 (254,200) 127,500 967,000 (240,000) 127,500 856,300 854,500 Intangible and Other Assets Patent Total Intangible Assets 48,000 60,000 48,000 60,000 Total Assets $ 1,533,020 $ 1,405,400 Liabilities Current Liabilities Accounts Payable Income Tax Payable Wages Payable Interest Payable Total Current Liabilities $ 121,500 34,726 3,400 1,200 $ 112,000 15,900 2,800 1,000 $ 160,826 $ 131,700 400,000 Non-Current Liablities Bond Payable Premium on Bonds Payable Total Non-Current Liabilities 450,000 1,800 451,800 400,000 Total Liabilities 612,626 531,700 Stockholders' Equity Paid in Capital Common Stock Paid in Capital in Excess of Par-Common Total Paid in Capital 520,000 214,000 500,000 200,000 734,000 700,000 Retained Earnings 186,394 173,700 Total Stockholders' Equity 920,394 873,700 Total Liabilities and Stockholders' Equity $ 1,533,020 $ 1,405,400 Retained Earnings Statement For the Year Ending December 31, 2021 and 2020 2021 2020 Beginning Balance as on January 1 Net Income Dividends Declared Ending Balance of Retained Earnings 173,700 50,694 (38,000) $186,394 $151,000 47,700 (25,000) $173,700 1. Prepare a cash flow statement (indirect method) for 2021 only (not comparative) based upon the changes in the balance sheet account balances from 2020 to 2021 and the following additional pieces of information which explain some of the events which occurred in 2021 (some of these transactions were included in the previous assignment). Remember that the cash flow statement for 2021 should explain the change in the amount of every balance sheet account from 2020 to 2021. A. B. C. D. Sold $50,000 of five year, 10% bonds at 104 in cash. Amortized $200 of premium on bonds payable. Sold 2,000 shares of common stock for $34,000 in cash on October 1, 2021. Sold equipment for $18,000 in cash. The equipment cost $139,650 and had a book value of $13,600 on the date of the sale. Recorded $140,250 of depreciation on equipment for 2021. Amortized the patent for 2021. Declared cash dividends of $0.50 per share on June 1, 2021, and $0.25 per share on December 31; not all of the dividends have been paid by the end of the year. E. F. G. H. I. Deposited $80,000 of cash into the Building Fund (ignore interest income). Paid $50,000 in cash for Available for Sale Securities. Sold $11,650of the Available for Sale Securities for $16,000 in cash. Purchased additional equipment for cash (you have to determine the amount). J. K. 2021 2020 $ $ 978,000 (1,850) Sales Sales return Net Sales Cost of Goods Sold Gross Profit $ 976,150 391,000 585,150 925,000 (1,500) $ 923,500 380,000 543,500 Operating Expenses Wages Expense Depreciation Expense Utilities Expense Insurance Expense Rent Expense Advertising Expense Amortization Expense Bad Debts Expense Supplies Expense Total Operating Expense Income From Operations Other Revenue Gain on Sale of Assets Interest Income Dividend Income (153,300) (140,250) (70,150) (42,000) (41,000) (15,000) (12,000) (9,780) (7,000) (144,000) (135,500) (69,150) (35,000) (39,000) (12,000) (9,250) (9,000) (490,480) 94,670 (452,900) 90,600 8,750 3,000 2,000 7,500 2,500 13,750 108,420 10,000 100,600 Other Expenses Interest Expense Loss from Early Retirement of Debt (36,000) (32,000) (5,000) Income Before Income Tax Income Tax Expense (30% for 2021, 25% for 2020) Net Income (36,000) 72,420 (21,726) 50,694 (37,000) 63,600 (15,900) 47,700 $ $ Earnings Per Share on Net Income 50694/50500 $ 1.00 47700/49250 $ 0.97 50500 Dec 31.21 Jan. 1.21 50,000 X 12/12 = 50,000 Oct. 1. 212,000 X 3/12 = 500 Jan.1.20 Apr.4.20 Dec.31.20 47000*12/12 3000*9/12 50000 47000 2250 49250 2021 2020 Assets Current Assets Cash Accounts Receivable Allowance for Doubtful Accounts Merchandise Inventory Supplies Prepaid Insurance Total Current Assets 99,400 126,720 (3,600) $ 258,100 1,400 5,700 80,250 143,000 (3,000) $ 241,500 1,000 5,500 $ 487,720 $ 468,250 Investments and Funds Building Fund Available for Sale Securities Total Investments and Funds 80,000 61,000 22,650 141,000 22,650 Fixed Assets Equipment Accumulated Depreciation-Equipment Land Total Fixed Assets 983,000 (254,200) 127,500 967,000 (240,000) 127,500 856,300 854,500 Intangible and Other Assets Patent Total Intangible Assets 48,000 60,000 48,000 60,000 Total Assets $ 1,533,020 $ 1,405,400 Liabilities Current Liabilities Accounts Payable Income Tax Payable Wages Payable Interest Payable Total Current Liabilities $ 121,500 34,726 3,400 1,200 $ 112,000 15,900 2,800 1,000 $ 160,826 $ 131,700 400,000 Non-Current Liablities Bond Payable Premium on Bonds Payable Total Non-Current Liabilities 450,000 1,800 451,800 400,000 Total Liabilities 612,626 531,700 Stockholders' Equity Paid in Capital Common Stock Paid in Capital in Excess of Par-Common Total Paid in Capital 520,000 214,000 500,000 200,000 734,000 700,000 Retained Earnings 186,394 173,700 Total Stockholders' Equity 920,394 873,700 Total Liabilities and Stockholders' Equity $ 1,533,020 $ 1,405,400 Retained Earnings Statement For the Year Ending December 31, 2021 and 2020 2021 2020 Beginning Balance as on January 1 Net Income Dividends Declared Ending Balance of Retained Earnings 173,700 50,694 (38,000) $186,394 $151,000 47,700 (25,000) $173,700 1. Prepare a cash flow statement (indirect method) for 2021 only (not comparative) based upon the changes in the balance sheet account balances from 2020 to 2021 and the following additional pieces of information which explain some of the events which occurred in 2021 (some of these transactions were included in the previous assignment). Remember that the cash flow statement for 2021 should explain the change in the amount of every balance sheet account from 2020 to 2021. A. B. C. D. Sold $50,000 of five year, 10% bonds at 104 in cash. Amortized $200 of premium on bonds payable. Sold 2,000 shares of common stock for $34,000 in cash on October 1, 2021. Sold equipment for $18,000 in cash. The equipment cost $139,650 and had a book value of $13,600 on the date of the sale. Recorded $140,250 of depreciation on equipment for 2021. Amortized the patent for 2021. Declared cash dividends of $0.50 per share on June 1, 2021, and $0.25 per share on December 31; not all of the dividends have been paid by the end of the year. E. F. G. H. I. Deposited $80,000 of cash into the Building Fund (ignore interest income). Paid $50,000 in cash for Available for Sale Securities. Sold $11,650of the Available for Sale Securities for $16,000 in cash. Purchased additional equipment for cash (you have to determine the amount). J. K

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