Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Problem 22-7 (a) (direct method) SFP accounts of Ivanhoe Inc., which follows IFRS, follow: IVANHOE INC. Comparative Statement of Financial Position Accounts December 31, 2020
Problem 22-7 (a) (direct method) SFP accounts of Ivanhoe Inc., which follows IFRS, follow: IVANHOE INC. Comparative Statement of Financial Position Accounts December 31, 2020 and 2019 December 31 Debit accounts 2020 2019 Cash $45,490 $34,150 Accounts receivable 67,150 59,650 Merchandise inventory 30,260 24,350 Long-term FV-NI investments 23,420 40,750 Machinery 29,650 18,400 Buildings 68,040 56,700 Land 7,500 7,500 $271,510 $241,500 Credit accounts Allowance for doubtful accounts Accumulated depreciation-machinery Accumulated depreciation-buildings Accounts payable Accrued liabilities Income taxes payable Long-term note payable-non-trade Common shares Retained earnings $3,770 5,570 13,300 30,140 2,465 890 25,400 150,000 39,975 $271,510 $3,020 2,200 8,800 24,900 1,210 1,390 30,400 125,000 44,580 $241,500 Additional information: Ivanhoe Inc. has adopted the policy of classifying interest paid as operating activities and dividends paid as financing activities. 1. Cash dividends declared during the year were $16,995. 2. A 20% stock dividend was declared during the year and $25,000 of retained earnings was capitalized. 3. FV-NI investments that cost $20,300 and had a fair value at December 31, 2019, of $24,300 were sold during the year for $22,800. 4. Machinery that cost $3,820 and had $750 of depreciation accumulated was sold for $2,210. Ivanhoe's 2020 statement of income is as follows: Sales revenue Cost of goods sold Gross margin Operating expenses includes $8,620 depreciation and $5,400 bad debts) Income from operations Loss on disposal of FV-NI investments $(1,500) Interest expense (3,000) Loss on disposal of machinery (860) Income before tax Income tax expense Net income $636,000 376,000 260,000 180,250 79,750 (5,360) 74,390 37,000 $37,390 Calculate net cash flow from operating activities using the direct method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) IVANHOE INC. Statement of Cash Flow For the Year Ended December 31, 2020 Cash Flows from Operating Activities $ V
Step 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