Question
Q.1 The financial statements for the BestBuy Store Inc. are as follows: Marks 15 INCOME STATEMENT 2019 Sales $800,000 0 Cost of goods sold 500,000
Q.1 The financial statements for the BestBuy Store Inc. are as follows: Marks 15
INCOME STATEMENT
2019
Sales$800,0000
Cost of goods sold500,0000
Gross Profit300,0000
Selling and Operating Expense213,0000
Net Operating Income87,0000
Non-operating items: -
Gain on sale of investing7,0000
Loss on sale of equipment(40000)3,0000
Income before taxes90,0000
Income Taxes270,000
Net Income630,000
During 2019, BestBuy sold some equipment for $200,000 that had cost $400,000 and on which there was accumulated depreciation of $160,000. In addition, the company sold the long-term investment for $100,000 that had cost $30,000 when purchased several years ago. A cash dividend was paid during 2019, and the company repurchased $400,000 of its own stock. BestBuy did not retire any bonds during 2019.
BestBuy Inc.
Balance Sheet
2019
2018
2019
Cash
150,000
90,000
Accounts Receivable
2400,000
3400,000
Inventory
1750,000
1250,000
Prepaid Expenses
60,000
100,000
Total Current Assets:
4360,000
4840,000
Property, Plant and Equipment
4700,000
6100,000
Less: Accumulated Depreciation
850,000
930,000
Net Property Plant and Equipment
3850,000
5170,000
Long Term Investment
190,000
160,000
Total Assets:
8400,000
10170,000
Accounts Payable
2300,000
3100,000
Accrued Liabilities
720,000
600,000
Income Taxes Payable
340,000
400,000
Total Current Liabilities:
3360,000
4100,000
Bonds Payable
1800,000
2900,000
Total Liabilities:
5160,000
7000,000
Common Stock
2500,000
2100,000
Retained Earnings
740,000
1070,000
Total Stockholders Equity
3,240,000
3,170,000
Total Liabilities and Stockholders Equity
8,400,000
10,170,000
Required:
Prepare a Cash Flow statement including operating, financing and investing activities. Place the bracket around the cash outlays. Operating activities should be prepared by direct Method.
Q. 2Use the information above in question no. 1. Prepare cash flows from operating activities through the Indirect Method.
Q.1 The financial statements for the BestBuy Store Inc. are as follows: Marks 15
INCOME STATEMENT
2019
Sales$800,0000
Cost of goods sold500,0000
Gross Profit300,0000
Selling and Operating Expense213,0000
Net Operating Income87,0000
Non-operating items: -
Gain on sale of investing7,0000
Loss on sale of equipment(40000)3,0000
Income before taxes90,0000
Income Taxes270,000
Net Income630,000
During 2019, BestBuy sold some equipment for $200,000 that had cost $400,000 and on which there was accumulated depreciation of $160,000. In addition, the company sold the long-term investment for $100,000 that had cost $30,000 when purchased several years ago. A cash dividend was paid during 2019, and the company repurchased $400,000 of its own stock. BestBuy did not retire any bonds during 2019.
BestBuy Inc.
Balance Sheet
2019
| 2018 | 2019 |
Cash | 150,000 | 90,000 |
Accounts Receivable | 2400,000 | 3400,000 |
Inventory | 1750,000 | 1250,000 |
Prepaid Expenses | 60,000 | 100,000 |
Total Current Assets: | 4360,000 | 4840,000 |
Property, Plant and Equipment | 4700,000 | 6100,000 |
Less: Accumulated Depreciation | 850,000 | 930,000 |
Net Property Plant and Equipment | 3850,000 | 5170,000 |
Long Term Investment | 190,000 | 160,000 |
Total Assets: | 8400,000 | 10170,000 |
Accounts Payable | 2300,000 | 3100,000 |
Accrued Liabilities | 720,000 | 600,000 |
Income Taxes Payable | 340,000 | 400,000 |
Total Current Liabilities: | 3360,000 | 4100,000 |
Bonds Payable | 1800,000 | 2900,000 |
Total Liabilities: | 5160,000 | 7000,000 |
Common Stock | 2500,000 | 2100,000 |
Retained Earnings | 740,000 | 1070,000 |
Total Stockholders Equity | 3,240,000 | 3,170,000 |
Total Liabilities and Stockholders Equity | 8,400,000 | 10,170,000 |
Required:
Prepare a Cash Flow statement including operating, financing and investing activities. Place the bracket around the cash outlays. Operating activities should be prepared by direct Method.
Q. 2Use the information above in question no. 1. Prepare cash flows from operating activities through the Indirect Method.
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