Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Concord House Inc. had the following condensed statement of financial position at December 31, 2019: CONCORD HOUSE INC. Statement of Financial Position December 31, 2019

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

Concord House Inc. had the following condensed statement of financial position at December 31, 2019: CONCORD HOUSE INC. Statement of Financial Position December 31, 2019 Cash $10,500 Current liabilities $14,550 Current assets (non-cash) 34,450 Long-term notes payable 30,500 Bond investment at amortized cost 40,400 Bonds payable 32,450 Plant assets (net) 57,550 Common shares 80,400 Land 38,950 Retained earnings 23,950 $181,850 $181,850 Concord House Inc. follows IFRS and chooses to classify dividends paid as financing activities and interest paid as operating activities on the statement of cash flows. During 2020, the following occurred: 1. Concord House Inc. sold part of its investment portfolio in bonds for $16,000, resulting in a gain of $500. Dividends totalling $17,600 were paid to shareholders. Dividends paid are treated as financing activities. 2. 3. A parcel of land, to be used as a parking lot, was purchased for $4,600. 4. Common shares were issued for cash totalling $20,000. 5. Bonds payable of $8,300 were retired at par. Equipment was purchased through the issuance of $30,000 of bonds. 6. 7. Net income for 2020 was $52,000 after allowing for depreciation on Concord House Inc's plant assets of $14,450. The amount of interest paid during 2020 was $4,240 and the amount of income taxes paid was $19,800. 8. Both current assets (other than cash) and current liabilities remained at the same amount. Prepare a statement of cash flows for 2020 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) CONCORD HOUSE INC. Statement of Cash Flows (Indirect Method) For the Year Ended December 31, 2020 Cash Flows from Operating Activities Net Income /(Loss) $ Adjustments to reconcile net income to net cash provided by operating activities: Gain on Disposal of Investment in Bonds $ $ Depreciation Expense Net Cash Provided by Operating Activities Cash Flows from Investing Activities Purchase of Land . Proceeds on Sale of Investment in Bonds Net Cash Provided by Investing Activities Cash Flows from Financing Activities Dividends Paid Payments to Retire Bonds Payable Proceeds from Issuance of Common Shares Net Cash Used by Financing Activities Net Increase in Cash Cash Balance, January 1, 2020 Cash Balance, December 31, 2020 $ Non-Cash Investing and Financing Activities Issuance of Bonds for Equipment $ Supplemental disclosures of cash flow information: Cash Paid During the Year for Interest $ Cash Paid During the Year for Income Taxes Bonds Payable Common Shares Retained Earnings $

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting A Critical Approach

Authors: John Friedlan

1st Edition

0130193720, 978-0130193728

More Books

Students also viewed these Accounting questions

Question

Describe what a one-minute self-sell is and what it contains.

Answered: 1 week ago

Question

List and explain the steps in the negotiating process.

Answered: 1 week ago