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Required information Exercise 21-32 Statement of cash flows;T-account method [LO21-8] Appendix B [The following information applies to the questions displayed below.) Part 1 of 2 Comparative balance sheets for 2018 and 2017, a statement of income for 2018, and additional information from the accounting records of Red, Inc., are provided below. points eBook Hint RED, INC. Comparative Balance Sheets December 31, 2018 and 2017 ($ in millions) 2018 2017 Assets Cash $ 21.8 $ 153.3 Accounts receivable 177.0 121.0 Prepaid insurance - 7.2 5.2 Inventory 300.0 160.0 Buildings and equipment 434.0 354.0 Less: Accumulated (102.0) (248.0) depreciation $ 838.0 $ 545.5 Liabilities Accounts payable $ 77.0 $ 95.5 Accrued expenses payable 15.0 21.0 Notes payable 100.0 Bonds payable 185.0 0.0 Shareholders' Equity Common stock 400.0 400.0 Retained earnings 61.0 29.0 $ 838.0 $ 545.5 Print 0.0 References RED, INC. Statement of Income For Year Ended December 31, 2018 ($ in millions) Revenues Sales revenue $3,200.0 Expenses Cost of goods sold $2,304.0 Depreciation expense 25.0 Operating expenses 739.0 3,068.0 Net income $ 132.0 Additional information from the accounting records: Additional information from the accounting records: Part 1 of 2 a. During 2018, $260.0 million of equipment was purchased to replace $180.0 million of equipment (95.0% depreciated) sold at book value. b. In order to maintain the usual policy of paying cash dividends of $100.0 million, it was necessary for Red to borrow $100.0 million from its bank. points Exercise 21-32 Part 1 eBook Required: Prepare the T-account for Red, Inc. (Enter your answers in millions rounded to 1 decimal place (i.e., 5,500,000 should be entered as 5.5).) Hint Cash (Statement of Cash Flows) Print From customers 3,144.0 (2.462.5) 747.0 References Beg. Bal. Operating Activities: From customers To suppliers For expenses Investing Activities: Purchase of equipment Sale of equipment Financing Activities: Payment of dividends Issuance of notes Issuance of bonds End. Bal. (260.0) 9.01 (100.0) 185.0 100.0 1,362.5 Required information Part 1 of 2 Accounts Receivable Prepaid Insurance Beg. Bal Beg. Bal 2 points End. Bal End. Bal eBook Inventory Buildings and Equipment Beg. Bal Beg. Bal Hint End. Bal End. Bal Print Accumulated Depreciation Accounts Payable Beg. Bal Beg. Bal References End. Bal End. Bal Accrued Expenses Payable Notes Payable Beg Bal Beg. Bal End. Bal End. Bal Bonds Payable Sales Beg. Bal Beg. Bal End. Bal End. Bal Required information Dey. Lai Lucy. Dai Part 1 of 2 End. Bal End. Bal Bonds Payable points Beg. Bal Beg. Bal eBook End. Bal End. Bal Cost of Goods Sold Depreciation Expense Hint Beg. Bal Beg. Bal Print End. Bal End. Bal Operating Expenses Net Income (Income Summary) References Beg. Bal Beg. Bal End. Bal End. Bal Retained Earnings Beg. Bal End. Bal
