Question
Exercise 23-12 Condensed financial data of Sandhill Company for 2020 and 2019 are presented below. SANDHILL COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020
Exercise 23-12
Condensed financial data of Sandhill Company for 2020 and 2019 are presented below.
SANDHILL COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 | ||||||
---|---|---|---|---|---|---|
2020 | 2019 | |||||
Cash | $1,780 | $1,170 | ||||
Receivables | 1,760 | 1,280 | ||||
Inventory | 1,620 | 1,880 | ||||
Plant assets | 1,910 | 1,670 | ||||
Accumulated depreciation | (1,210 | ) | (1,160 | ) | ||
Long-term investments (held-to-maturity) | 1,330 | 1,440 | ||||
$7,190 | $6,280 | |||||
Accounts payable | $1,230 | $920 | ||||
Accrued liabilities | 210 | 250 | ||||
Bonds payable | 1,370 | 1,560 | ||||
Common stock | 1,920 | 1,680 | ||||
Retained earnings | 2,460 | 1,870 | ||||
$7,190 | $6,280 |
SANDHILL COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020 | ||
---|---|---|
Sales revenue | $6,820 | |
Cost of goods sold | 4,600 | |
Gross margin | 2,220 | |
Selling and administrative expenses | 910 | |
Income from operations | 1,310 | |
Other revenues and gains | ||
Gain on sale of investments | 80 | |
Income before tax | 1,390 | |
Income tax expense | 540 | |
Net income | 850 | |
Cash dividends | 260 | |
Income retained in business | $590 |
Additional information: During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2020. Prepare a statement of cash flows using the direct method.
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