Question
Gadfly Corporations income statement for the year ended December 31, 2020, and comparative balance sheets at December 31, 2019 and 2020 appear below: Gadfly Corporation
Gadfly Corporations income statement for the year ended December 31, 2020, and comparative balance sheets at December 31, 2019 and 2020 appear below:
Gadfly Corporation
Comparative Balance Sheets
| Dec. 2019 | Dec. 2020 |
Assets |
|
|
Cash | $ 80 | $240 |
A/R | 100 | 150 |
Inventory | 190 | 130 |
|
|
|
LT-investments | 220 | 180 |
Plant and equipment | 400 | 440 |
Acc. Depreciation | (200) | (220) |
Land | 0 | 580 |
Total | $790 | $1,500 |
|
|
|
Liabilities and equity |
|
|
A/P | $210 | $ 90 |
Wages payable | 80 | 60 |
|
|
|
LT-NP | 100 | 270 |
C/S | 100 | 600 |
R/E | 300 | 480 |
Total | $790 | $1,500 |
|
|
|
|
|
|
Income Statement
For the Year Ended December 31, 2020
Sales revenue | $1,340 |
CGS | (760) |
Depreciation | (100) |
Other expenses | (300) |
Loss on sale of equipment | (20) |
Gain on sale of LT-investments | 100 |
NI | $ 260 |
|
|
Additional data for 2020:
- Plant and equipment costing $160 (50% depreciated) was sold at the end of 2020 for $60 cash.
- Acquired land costing $200; paid $50; gave LT-NP for the balance.
- Paid $80 on LT-NP.
- Issued common stock for $200 cash.
- Acquired plant and equipment for $200; paid 50% cash; gave LT-NP for the balance.
- Issued 300 C/S for land with a fair value of $380 and paid the balance in cash. The shares were actively traded at $1 per share.
- Sold LT-investments for $140.
Dividends were declared and paid in the same year
Step by Step Solution
There are 3 Steps involved in it
Step: 1
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-text-image.webp)
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Step: 3
![blur-text-image](https://dsd5zvtm8ll6.cloudfront.net/includes/images/document_product_info/blur-subtext-image.webp)
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started