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Bikelt Inc. is a major retailer of road bicycles and a promoter of riding bicycles to work, both to save the environment and improve physical
Bikelt Inc. is a major retailer of road bicycles and a promoter of riding bicycles to work, both to save the environment and improve physical fitness. Financial statements for Bikelt are presented below. Accounts receivable Merchandise inventory Prepaid expenses Total current assets Property and Equipment Less: Accumulated depreclatlon Net property and equipment TOTAL ASSETS Current Liabilities Salaries payable Interest payable Shareholders Equity 200 48.800 49,000 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY $205,100 $135,000 Common share Retained earrings Total shareholders equity 73,000 For the Years Ended December 31 2018 600,000 500,000 405,000 350,000 195,00 150,000 2017 Sales Cost of sales Gross margin Expenses Salary axpanse Interest expense Other expenses Deprediation expense Total expenses 36,00 125,0 3,500 2,400 8,000 160,400 138,400 34,600 11,600 14,900 Operating Income Gain on sale of equiment1,000 6,400 Income tax expense 1,972 Net incorme $29,20 $,08 The following is additional Information conceming Bikelt's transactions during the year ended December 31, 2018 Equipment costing $40,000 was purchased by paying $35,200 cash and issuing 100 shares. Equipment costing $3 000 that was purchased at the beginning of 2017 was sold at the end of 2018 for $25,000 Straight-line depreciation had been used with an expected asset ife of 10 The "uother expenses" relate to prepaid itens The others ePid ears and a residual value of S . In arder to supplement its cash, Bikelt barrowed an additianal $40,000. .Cash dividends uf $5,000 were paid at the end of the fiscal year. eikelt fellows IFRS and has chosen not to include dividends paid in the operating sectiori of the staternent of cash flows. .Cost costs. of salas includes$ 200,000 af direct lahour Prepare a statement of cash flows for Bikelt tor the year ended December 31, 2018 using the direct method Include any note discosure on non-cash financing and investing transactions. parenthesis e.g. (15,000).) Show amounts that decrease cash now with either sign eg. 15,000 or in Bikelt, Inc Statenent of Cash Flows
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