Exercise 13-12 (Direct Method) The comparative unclassified statement of financial position for Puffy Ltd. follows: PUFFY LTD Statement of Financial Position December 31 2015 2014 Assets Cash Accounts receivable Merchandise inventory Land Equipment Accumulated depreciation Total assets $59,970 $21,520 73,200 186,660 190,950 71,750 101,460 266,830 197,220 (31,770) $598,410 $552,580 78,620 Liabilities and Shareholders' Equity Accounts payable Bank loan payable Common shares Retained earning:s Total liabilities and shareholders' equity $598,410 $38,100 $ 46,380 162,670 199,690 199,910 172,400 197,730 134,110 $552,580 Additional information: Profit was $104,040. Sales were $970,260. Cost of goods sold was $752,970. Operating expenses were $43,310, exclusive of depreciation expense. Depreciation expense was $33,650. Interest expense was $14,110. Income tax expense was $27,060. Land was sold at a gain of $4,880 No equipment was sold during the year. $37,020 of the bank loan was repaid during the year. Common shares were issued for $27,510. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11