Question
Financial data is available from the accounts of Tarralo Corporation: 12/31/20 12/31/19 Cash 36,000 25,000 Accounts receivable, net 143,000 118,000 Inventory 130,000 140,000 Prepaid rent
Financial data is available from the accounts of Tarralo Corporation:
|
| 12/31/20 | 12/31/19 |
| Cash | 36,000 | 25,000 |
| Accounts receivable, net | 143,000 | 118,000 |
| Inventory | 130,000 | 140,000 |
| Prepaid rent | 11,000 | 10,000 |
| Machinery | 189,000 | 170,000 |
| Accumulated depreciation-Machinery | (90,000) | (70,000) |
| Equipment | 175,000 | 190,000 |
| Accumulated depreciation-Equipment | (60,000) | (45,000) |
|
| 534,000 | 538,000 |
|
|
|
|
| Accounts payable | 18,000 | 28,000 |
| Salaries payable | 10,000 | 17,000 |
| Accrued expenses | 8,000 | 18,000 |
| Income taxes payable | 10,000 | 13,000 |
| Bonds payable | 200,000 | 200,000 |
| Discount on bonds payable | (7,000) | (8,000) |
| Common stock | 210,000 | 200,000 |
| Retained earnings | 85,000 | 70,000 |
|
| 534,000 | 538,000 |
|
|
|
|
|
| FY 2020 |
|
| Sales | 650,000 |
|
| Cost of goods sold | 395,000 |
|
| Selling expenses | 105,000 |
|
| Administrative expenses | 88,000 |
|
| Interest expense | 29,000 |
|
| Gain on the sale of equipment | 4,000 |
|
| Income tax expense | 12,000 |
|
|
|
|
|
Additional information:
- All depreciation is included in selling expenses.
- Old equipment with an original cost of $40,000 was sold for $15,000.
Required: Prepare a Statement of Cash Flows for Tarralo Corporation for the year ended 12/31/20 using the indirect method. Include required disclosures.
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