Question
Problem 23-08 Comparative balance sheet accounts of Oriole Company are presented below. ORIOLE COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31 Debit Balances 2020
Problem 23-08
Comparative balance sheet accounts of Oriole Company are presented below.
ORIOLE COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31 | ||||
Debit Balances | 2020 | 2019 | ||
Cash | $70,700 | $50,900 | ||
Accounts Receivable | 154,500 | 131,300 | ||
Inventory | 75,000 | 61,600 | ||
Debt investments (available-for-sale) | 55,200 | 84,600 | ||
Equipment | 69,700 | 47,600 | ||
Buildings | 144,200 | 144,200 | ||
Land | 39,800 | 24,800 | ||
Totals | $609,100 | $545,000 | ||
Credit Balances | ||||
Allowance for Doubtful Accounts | $9,900 | $8,000 | ||
Accumulated DepreciationEquipment | 20,800 | 13,800 | ||
Accumulated DepreciationBuildings | 37,300 | 28,100 | ||
Accounts Payable | 66,700 | 59,700 | ||
Income Taxes Payable | 11,900 | 9,900 | ||
Long-Term Notes Payable | 62,000 | 70,000 | ||
Common Stock | 310,000 | 260,000 | ||
Retained Earnings | 90,500 | 95,500 | ||
Totals | $609,100 | $545,000 |
Additional data:
1. | Equipment that cost $9,900 and was 60% depreciated was sold in 2020. | |
2. | Cash dividends were declared and paid during the year. | |
3. | Common stock was issued in exchange for land. | |
4. | Investments that cost $34,600 were sold during the year. | |
5. | There were no write-offs of uncollectible accounts during the year. |
Orioles 2020 income statement is as follows.
Sales revenue | $951,100 | ||||
Less: Cost of goods sold | 603,200 | ||||
Gross profit | 347,900 | ||||
Less: Operating expenses (includes depreciation expense and bad debt expense) | 249,700 | ||||
Income from operations | 98,200 | ||||
Other revenues and expenses | |||||
Gain on sale of investments | $15,000 | ||||
Loss on sale of equipment | (3,100 | ) | 11,900 | ||
Income before taxes | 110,100 | ||||
Income taxes | 45,300 | ||||
Net income | $64,800 |
(a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Net cash flow from operating activities | $ |
(b) Prepare a statement of cash flows using the indirect method.
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