Question
Condensed financial data of Cheng Inc. follow. CHENG INC. Comparative Balance Sheets December 31 Assets 2020 2019 Cash $105,900 $47,000 Accounts receivable 92,700 33,100 Inventory
Condensed financial data of Cheng Inc. follow. CHENG INC. Comparative Balance Sheets December 31 Assets 2020 2019 Cash $105,900 $47,000 Accounts receivable 92,700 33,100 Inventory 112,800 101,000 Prepaid expenses 29,200 25,500 Investments 139,400 114,200 Equipment 264,500 241,400 Accumulated depreciation-equipment (46,800 ) (52,400 ) Total $697,700 $509,800 Liabilities and Stockholders Equity Accounts payable $111,900 $67,800 Accrued expenses payable 16,000 17,300 Bonds payable 117,200 149,500 Common stock 219,100 175,300 Retained earnings 233,500 99,900 Total $697,700 $509,800 CHENG INC. Income Statement For the Year Ended December 31, 2020 Sales revenue $392,600 Less: Cost of goods sold $136,000 Operating expenses, excluding depreciation 11,700 Depreciation expense 32,300 Income tax expense 27,600 Interest expense 4,000 Loss on disposal of plant assets 7,500 219,100 Net income $173,500 Additional information: 1. New equipment costing $81,000 was purchased for cash during the year. 2. Old equipment having an original cost of $57,900 was sold for $12,500 cash. 3. Bonds matured and were paid off at face value for cash. 4. A cash dividend of $39,900 was declared and paid during the year. Prepare a statement of cash flows 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).)
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