Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Save & Instant Brake Inc.'s comparative balance sheet information at December 31, 2020 and 2019, and its income statement for the year ended December 31,
Save & Instant Brake Inc.'s comparative balance sheet information at December 31, 2020 and 2019, and its income statement for the year ended December 31, 2020, are as follows: $877,000 572,000 $305,000 Instant Brake Inc. Income Statement December 31, 2020 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Operating Profit Loss on sale of equipment Investment income Profit before taxes Income taxes $132, 680 41, 240 173,920 131,080 11,550 18,520 138,050 16,000 6122,05 Profit Cash Cash equivalents Accounts receivable Inventory Investment Land Building and equipment Accumulated depreciation Accounts payable Dividends payable Bonds payable Preferred shares Common shares Retained earnings Instant Brake Inc. Balance Sheet Information December 31 2020 2019 $ 44,000 $ 24,160 24,280 8,800 87,520 33,440 113,440 79,520 0 24,280 76,000 76,000 423,240 441,760 114,050 92,960 12, 510 37,000 1,600 1,000 0 20,000 80,800 80,800 405, 280 405, 280 134,240 70,920 Net Change $ 19,840 15,480 54,080 33,920 24,280) 0 (18,520) 21,090 (24,490) 600 20,000 0 0 63,320 Next > 1 of 5 During 2020, the following transactions occurred: 1. Purchased equipment for $20,600 cash. 2. Sold the investment on January 1, 2020, for $42,800, resulting in investment income of $18,520. 3. Sold equipment for $7,420 cash that had originally cost $39,120 and had $20,150 of accumulated depreciation. 4. Issued $20,000 of bonds payable at face value. Required: 1. How much cash was paid in dividends? Dividends paid 2. Prepare a statement of cash flows for Instant Brake for the year ended December 31, 2020, using the indirect method. (List any deduction in cash and cash outflows as negative amounts.) INSTANT BRAKE INC. Statement of Cash Flovt For Year Ended December 31, 2020 Cash flows from operating activities: Adjustments to reconcile profit to net cash inflows from operating activities
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