Question
Comparative balance sheets: 2019 and 2020, an income statement for 2020 are provided below for Dandelions shop. Balance Sheet As of December 31 st Assets
Comparative balance sheets: 2019 and 2020, an income statement for 2020 are provided below for Dandelions shop.
Balance Sheet
As of December 31st
Assets | 2020 | 2019 |
Cash | $1,550 | $1,100 |
Account Receivable | 550 | 1,200 |
Inventory | 1,800 | 1,300 |
Investment Trading Securities | 970 | 970 |
Fair Value Adjustment | 70 | 0 |
Property Plant & Equipment | 12,000 | 10,800 |
Accumulated Depreciation PPE | (4,650) | (5,400) |
Goodwill | $400 | $600 |
Total Assets | $12,690 | $10,570 |
Liabilities | ||
Accounts Payable | $200 | $550 |
Accrued Wages | 800 | 220 |
Convertible Bonds Payable | 0 | 300 |
Bonds Payable | 3,400 | 1,800 |
Discount on Bonds Payable | (10) | (12) |
Total Liabilities | $4,390 | $2,858 |
Stockholders Equity | ||
Common Stock | 4,300 | 3,100 |
Paid-in capital Common Stock | 300 | 100 |
Retained Earnings | 3,700 | 4,512 |
Total Liability & Stockholders Equity | $12,690 | $10,570 |
Income Statement
During the Year Ended December 31st
Revenues | 2020 | |
Sales Revenue | $25,600 | |
Dividend Revenue | 110 | |
Unrealized Holding Gain/Loss - Income | 70 | |
Total Net Sales | $25,780 | |
Expenses | ||
Cost of Goods Sold | $21,300 | |
Operating Expenses | 4,287 | |
Interest Expense | 45 | |
Loss due to impairment of Goodwill | 200 | |
Loss on sale of Machinery | 70 | |
Total Expenses | 25,902 | |
Income Before Income Tax | (122) | |
Income Tax Expense | 0 | |
Net Income (Loss) | $ (122) |
Additional Information from the 2020 accounting records:
- Dandelion owns a 10% of Acorn Inc. which is labeled as a Trading Security that increased in market value during 2020. Acorn gave out $1,100 worth of dividends to all of its owners during 2020.
- Machinery (part of the Plant Property and Equipment value) with an original cost of $1,000 was sold. Depreciation was calculated using the straight-line method and exactly 90% of its useful life was used up.
- $1,600 worth of equipment was purchased by issuing a bond. All other Property, Plant, and Equipment purchases were made in cash.
- Depreciation is included as part of Operating Expense.
- 100% of Convertible bonds were exchanged for 100 shares of $1 par common stock.
Instructions: Prepare the statement of cash flow under the indirect method. Your finished product should have all the information disclosed on a formal statement, including a list of noncash transactions.
***Please explain/show work how you got each amounts***
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