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7. Acerler World Exotic Pet Shops, Incorporated reported the following comparative balance sheets and income statement for the current year. (Click the icon to view
7. Acerler World Exotic Pet Shops, Incorporated reported the following comparative balance sheets and income statement for the current year. (Click the icon to view the balance sheets.) 2(Click the icon to view the income statement.) Prepare the operating activities section of the statement of cash flows using the direct method. Assume accrued expenses relate to selling, general and administrative expenses. (Assume that all investment income was received in cash. Use a minus sign or parentheses for any cash outflows and/or net cash used by operating activities. If a box is not used in the statement, leave the box empty; do not select a label or enter a zero.) Acerler World Exotic Pet Shops, Incorporated Partial Statement of Cash Flows (Direct Method) For the Year Ended December 31 Operating Activities: (1) Cash Collected from Customers (2) Cash Paid for Merchandise |(3) Cash Paid to Other Suppliers (4) Cash Paid for Interest (5) Cash Investment Income Received (6) Cash Paid for Taxes (7) Net Cash Provided (Used) by Operating Activities 1: Balance Sheet Acerler World Exotic Pet Shops, Incorporated Balance Sheets At December 31 Assets Ending Beginning Current Assets Cash $ 7,600 $ 3,540 Accounts Receivable, net 8,700 7,300 Merchandise Inventory 2,350 4,700 Prepaid Insurance 1,760 2,210 20,410 $ 17,750 Total Current Assets Noncurrent Assets Investments 11,000 $ 24,320 Property, Plant, and Equipment -net 74,230 56,380 $ 85,230 $ Total Noncurrent Assets 80,700 $ 105,640 $ 98,450 Total Assets Liabilities Current Liabilities Accounts Payable $ 4,010 $ 1,100 Accrued Expenses 9,700 5,180 Income Taxes Payable 6,700 4,870 20,410 $ 11,150 Total Current Liabilities Noncurrent Liabilities $ 31,300 $ Notes Payable 42,400 $ 31,300 $ Total Noncurrent Liabilities 42,400 $ 51,710 $ 53,550 Total Liabilities Shareholders' Equity Common Stock, $1 par value 9,400 $ 9,400 Additional Paid-in Capital 19,200 19,200 Retained Earnings 25,330 16,300 Total Shareholders' Equity 53,930 $ 44,900 105,640 $ Total Liabilities and Shareholders' Equity 98,450 2: Income Statement Acerler World Exotic Pet Shops Income Statement For the year ended December 31 Sales $ 80,000 48,040 Cost of Goods Sold $ 31,960 Gross Profit Selling, General, and Administrative Expenses 10,100 Depreciation Expense 2,230 $ 12,330 Total Operating Expenses $ 19,630 Income Before Interest and Taxes Interest Expense (3,500) 2,000 Interest Revenue Income Before Tax $18,130 Income Tax Expense (7,785) $10,345 Net Income
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