Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Need help preparing statements of cash flow for both Indirect and Direct Method, especially with the additional transactions from 1-9. Thank you!! , The Sky
Need help preparing statements of cash flow for both Indirect and Direct Method, especially with the additional transactions from 1-9. Thank you!!
, The Sky Colpally tive balance sheets as of December 31 of 2019 and 2018 follow SKY COMPANY Income Statemont For Year Ended December 31, 2019 19,000 819,000 Sales revenue Dividend income $440,000 130,000 39,000 7,000 13,000 30,000 5.000 Cost of goods sold Wages and other operating expenses Patent amortization expense Interest expense income tax expense Loss on sale of equipment Gain on sale of investments Net income (10,000) 654,000 $165,000 SKY COMPANY Balance Sheets Dec. 31, 2019 Assets Cash and cash equivalents Accounts receivable Inventory Prepaid expenses Long-term investments-available for sale Fair value adjustment to investments Land Buildings Accumulated depreciation-Buildings 63,000 29.,000 35,000 77,000 6,000 50,000 7,000 190,000 100,000 445,000 350,000 91,000) (75,000) 179,000 225,000 42,000) (46,000) 50,000 32,000 $949,000 $790,000 45,000 100,000 10,000 Accumulated depreciation-Equipment Patents Total assets SKY COMPANY Balance Sheets Dec. 31 2018 2019 Liabilities and Stockholders' Equity Accounts payable Interest payable Income tax payable Bonds payable Preferred stock ($100 par value) Common stock ($5 par value) Paid-in-capital in excess of par value Common. Retained earnings Unrealized gain on investments s 21,000 18,000 5,000 12,000 135,000 130,000 75,000 379,000 364,000 133,000 124,000 55,000 7,000 $949,000 $790,000 ,000 8,000 100,000 167,000 Total labilities and stockholders' equity. . During the year, the following transactions occurred 1. Sold long-tern investments costing $50,000 for $60,000 cash. Unrealized gains totaling $7,000 n investments costing $50.000 for $60,000 cash. Unrealized gains totaling $7,000 related to these investments had been recorded in earlier years. At year-end, the fair value adjust- ment and unrealized gain account balances were eliminated. 2. Purchased land for cash. 3. Capitalized an expenditure made to improve the building 4. Sold equipment for $14,000 cash that originally cost $46,000 and had $27,000 accumulated depreciation. 5. Issued bonds payable at face value for cash. 6. Acquired a patent with a fair value of $25,000 by issuing 250 shares of preferred stock at par value. 7. Declared and paid a $53,000 cash dividend. 8. Issued 3,000 shares of common stock for cash at $8 per share. 9. Recorded depreciation of $16,000 on buildings and $23,000 on equipmentStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started