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GL1201 - Based on Exercise 12-11 LO P2, P3, A1 Use the following financial statements and additional information. ZEPHYR INC. Comparative Balance Sheets June 30, 2019 and 2018 2019 2018 $ 79,400 73,000 65,000 6,400 223,800 208,000 (51,000) $380,800 $ 15,200 57,000 90,000 8,000 170,200 193,000 (17,000) $346,200 Assets Cash Accounts receivable, net Inventory Prepaid expenses Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity $ 28,000 6,000 3,800 37,800 35,000 72,800 $ 34,000 16,000 4,200 54,200 70,000 124,200 250,000 58,000 $380,800 180,000 42.000 $346,200 ZEPHYR INC. Income Statement For Year Ended June 30, 2019 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $ 95,000 Other expenses 111,000 Total operating expenses $1,124,000 687,000 437,000 206,000 231,000 Other gains (losses) Gain on sale of equipment Income before taxes Income taxes expense Net income 8,700 239,700 73,370 166,330 $ Additional Information a. A $35,000 note payable is retired at its $35,000 carrying (book) value in exchange for cash. b. The only changes affecting retained earnings are net income and cash dividends paid. c. New equipment is acquired for $93,000 cash. d. Received cash for the sale of equipment that had cost $78,000, yielding a $8,700 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement. f. All purchases and sales of inventory are on credit. Requirement General Journal General Ledger Trial Balance Direct Method Indirect Method Requirement General Journal General Ledger Trial Balance Direct Method Indirect Method Using the income statement, the comparative balance sheet, and the additional information given above, reconstruct the entries for the summarized activity of the current fiscal year. Upon completion, the trial balance tab should agree with the June 30, 2019 balances. View transaction list Journal entry worksheet Reconstruct the journal entry for cash receipts from customers, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date Account Title Debit Credit Jun 30 1,108,000 Cash Accounts receivable, net 1,108,000 Record entry Clear entry View general journal Unadjusted ZEPHYR INC. Statement of Cash Flows (Direct Method) For Year Ended June 30, 2019 Cash flows from operating activities: Cash flows from investing activities: Cash flows from financing activities: Requirement General Journal General Ledger Trial Balance Direct Method Indirect Method Prepare the operating activities section of the statement of cash flows using the indirect method. Enter reductions to net cash provided by operating activities as negative values. Unadjusted ZEPHYR INC. Statement of Cash Flows (Indirect Method) For Year Ended June 30, 2019 Cash flows from operating activities: Adjustments to reconcile net income to net cash provided by operating activities:
