Question
Ram Inc. December 31, 2021 and 2020 balance sheet and income statement is shown below: additional info: 1. Gain on sale of equipment was $12,000.
Ram Inc. December 31, 2021 and 2020 balance sheet and income statement is shown below:
additional info:
1. Gain on sale of equipment was $12,000. This resulted from a sale of equipment that had an original cost of $50,000 and accumulated depreciation of $3,000. The equipment was sold for $59,000 cash.
2. Equipment costing $75,000 was purchased using $10,000 in cash and the remainder was financed with a long-term note payable.
3. Loss on retirement of bonds was $15,000. This resulted from a retirement of bonds that had been originally sold for $25,000. The bonds were purchased back for $40,000 cash paid.
4. Increase in common shares accounts is due to the issuance of 2,000 common shares.
5. Paid cash dividends of $50,000.
REQUIRED:
Prepare Cash Flow Statement for Ram inc. for December 31, 2021
ASSETS Cash Accounts receivable Merchandise inventory Equipment Accumulated depreciation Total Assets 2021 $ 35,000 52,800 117,000 375,000 (82.000) $497.800 2020 $ 15,000 40,000 101,500 350,000 (75.000) S 431.500 $46,700 25,000 135,000 LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable $54,000 Salaries payable 20,000 Bonds payable 110,000 Long-term notes payable 65,000 Common shares 115,000 Retained earnings 133.800 Total Liabilities and Equity $497.800 110,000 114.800 $431,500 The 2021 Income Statement was as follows: $664,000 Sales Expenses: Cost of goods Wages expense Rent expense Supplies expense Depreciation Total expenses Operating income Loss on retirement of bonds Gain on sale of plant asset Profit $350,000 125,000 80,000 27,000 10.000 592.000 72,000 (15,000) 12.000 $69.000Step by Step Solution
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