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HELP PLEASE, thank u in advance! Soft Touch Company was started several years ago by two golf instructors. The company's comparative balance sheets and income
HELP PLEASE, thank u in advance!
Soft Touch Company was started several years ago by two golf instructors. The company's comparative balance sheets and income statement are presented below, along with additional information Current Year Previous Year Balance Sheet at December 31 Cash Accounts Receivable Equipment Accumulated Depreciation-Equipment $6,500 2,900 11,000 (1,900) $18,500 $12,060 1,700 12,100 (2,340) $23,520 $900 760 2,400 11,000 8,460 $23,520 Total Assets Accounts Pavable Salaries and Wages Payable Note Payable (long-term) Common Stock Retained Earnings $1,400 1,200 1,000 11,000 3.900 $18,500 Total Liabilities and Stockholders' Equity Income Statement $71,400 65,000 440 1.400 Service Revenue Salaries and Wages Expense Depreciation Expense Income Tax Expense Net Income $4,560 Additional Data: a. Bought new golf clubs using cash, $1,100 b. Borrowed $1,400 cash from the bank during the year C. Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liability accounts relating to income tax, assume that Income Tax Expense was fully paid in cash Required: 1. Prepare the statement of cash flows for the current year ended December 31 using the direct method. TIP: Remember to exclude depreciation expense when converting to the cash basis. (Amounts to be deducted should be indicated with a minus sign.) SOFT TOUCH COMPANY Required: 1. Prepare the statement of cash flows for the current year ended December 31 using the direct method. TIP: Remember to exclude depreciation expense when converting to the cash basis. (Amounts to be deducted should be indicated with a minus sign.) SOFT TOUCH COMPANY Statement of Cash Flows For the Year Ended December 31 Cash Flows from Operating Activities: Cash Flows from Investing Activities Cash Flows from Financing ActivitiesStep by Step Solution
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