Scottsdale Company

Comparative Balance Sheet

December 31, 2019 and 2018

2019

2018

Increase (Decrease)

Lebel

Assets

Cash

$39,835.00

$4,000.00

$35,835.00

-

Accounts Receivable

$17,500.00

$12,950.00

$4,550.00

operating

Dividends Receivable

$1,000.00

$0.00

$1,000.00

investing

Inventory

$42,000.00

$35,000.00

$7,000.00

operating

Prepaid rent

$3,000.00

$12,000.00

$9,000.00

operating

Prepaid insurance

$2,100.00

$900.00

$1,200.00

operating

Office supplies

$1,000.00

$750.00

$250.00

operating

Long-term investments

$20,000.00

$30,000.00

$10,000.00

investing

Land

$125,000.00

$175,000.00

$50,000.00

investing

Building

$350,000.00

$350,000.00

$0.00

investing

Accumulated depreciation, Building

$105,000.00

$87,500.00

$17,500.00

investing

Equipment

$525,000.00

$400,000.00

$125,000.00

investing

Accumulated depreciation, Equipment

$130,000.00

$112,000.00

$18,000.00

investing

Patent

$45,000.00

$50,000.00

$5,000.00

investing

Total assets

$936,435.00

$871,100.00

$65,335.00

Liabilities

Accounts Payable

$26,000.00

$30,000.00

$4,000.00

operating

Income taxes payable

$5,000.00

$4,000.00

$1,000.00

operating

Wages payable

$5,000.00

$3,000.00

$2,000.00

operating

Short-term notes payable

$10,000.00

$10,000.00

$0.00

financing

Dividends payable

$1,500.00

$0.00

$1,500.00

financing

Unearned Income

$500.00

$2,000.00

$1,500.00

operating

Accrued liabilites

$5,303.00

$10,853.00

$5,550.00

operating

Long-term notes payable

$60,000.00

$70,000.00

$10,000.00

financing

Bonds payable

$415,000.00

$415,000.00

$0.00

financing

Total liabilities

$528,303.00

$544,853.00

$16,550.00

Stockholders' Equity

Common stock ($10 par)

$290,000.00

$220,000.00

$70,000.00

financing

Paid-in capital in excess of par

$46,410.00

$17,500.00

$28,910.00

financing

Retianed earnings

$106,722.00

$88,747.00

$17,975.00

na

Treasury stock

$35,000.00

$0.00

$35,000.00

financing

Total stockholders' equity

$408,132.00

$326,247.00

$81,885.00

financing

Total liabilities and stockholders' equity

$936,435.00

$871,100.00

$65,335.00

Scottsdale Company

Statement of Cash flows-Indirect method

For the year ended December 31, 2019

Cash flows from operating activities:

Net income

$58,850.00

Adjustment to reconcile net income to net cash flow

from operating activites:

Depreciation

$35,500.00

Amortisation of patent

$5,000.00

Gain on sale of land

$8,000.00

Gain on sale of long-term investment

$4,000.00

Changes in current operating assets and liabilites:

Increase in accounts receivable

$4,550.00

Increase in dividends receivable

$1,000.00

Increase in inventory

$7,000.00

Decrease in prepaid rent

$9,000.00

Increase in prepaid insurance

$1,200.00

Increase in office supplies

$250.00

Decrease in accounts payable

$4,000.00

Increase in income taxes payable

$1,000.00

Increase in wages payable

$2,000.00

Increase in dividends payable

$1,500.00

Decrease in unearned income

$1,500.00

Decrease in accrued liabilities

$5,550.00

Net cash flow from operating activities

$75,800.00

Cash flows from investing activities:

Cash received from sale of investment

$14,000.00

Cash paid for purchase of equipment

$125,000.00

Cash paid for purchase of land

$58,000.00

Net cash flow used for investing activities

$53,000.00

Cash flows from financing activities:

Cash received from sale of common stock

$98,910.00

Cash paid for long-term notes payable

$10,000.00

Cash paid for dividends

$40,875.00

Cash paid for treasury stock

$35,000.00

Net cash flow used for financing activities

$13,035.00

Change in cash

$35,835.00

Cash at the begginin of the year

$4,000.00

Cash at the end of the year

$39,835.00

Scottsdale company

Stament fo Cash Flows

For the year ended December 31, 2019

Cash flows from oerating activities:

Cash received from customers:

$1,155,450.00

Cash payment for merchandise

$759,000.00

Cash payment for operating expenses

$226,350.00

Cash payment for interes expenses

$57,300.00

Cash payment for incom taxes

$38,400.00

Dividend receivable

$1,400.00

Net cash flow from operating activities

$75,800.00

Cash flows from investing activities:

Cash received from sale of land

$58,000.00

Cash paid for long term investing

$14,000.00

Cash paid for purchase of equipment

$125,000.00

Net cash flow used for investing activities

$53,000.00

Cash flows from financing activities:

Cash received from sale of common stock

$98,910.00

Cash paid to retire long-term notes payable

$10,000.00

Cash paid for treasury stock

$35,000.00

Cash paid for dividends

$40,875.00

Net cash flow used for financing activities

$13,035.00

Change in cash

$35,835.00

Cash at the beginning of the year

$4,000.00

Cash at the end of the year

$39,835.00

For the Investing and Financing Sections:

Use T-Accounts for each account to help you solve for the correct amounts: start with beginning balance on the correct side; include what you know including ending balance; figure out what else needed to happen in order to get the ending balance.

Use journal entries (if appropriate) to help you visualize a transaction and its effect (or not) on cash

Be sure to account for all changes in the balance sheet and to reconcile those to the appropriate section of the cash flow statement.

Other Important Information

There are no non-cash transactions affecting investing activities.

The only sales of assets are the ones reflected in the income statement.

Make journal entries, including accounting equation impact, for the following transactions (this will be part of your grade):

On April 1, 2019, the company paid $14 per share for Treasury Shares. To remember how this affected financial position, review this in Chapter 12.

On Sept. 1, 2019, the company declared and issued a 5% stock dividend on outstanding shares when the market price of the stock was $17. To remember how this impacts financial position, review this in Chapter 12.

All other transactions affecting Contributed Capital and Retained Earnings occurred after Sept. 1, 2019.

There were no prior period adjustments.