SHERIDAN CHOCOLATE COMPANY Cash Flow Statement - Direct Method $ V V V V V V $ V V V V to V V V V V Note X: Land with a cost of $ was purchased by paying $ cash and issuing a mortgage note payable for $Current Attempt in Progress The following information is provided for Sheridan's Chocolate Company: SHERIDAN CHOCOLATE COMPANY Balance Sheet May 31 Assets 2021 2020 Cash $32,425 $43,500 Accounts receivable 84,100 75,500 Inventory 171,000 156,500 Prepaid expenses 4,600 6,100 Land 119,500 73,000 Equipment 306,000 186,000 Accumulated depreciation-equipment (64,200 ) (36,500 ) Total assets $653,425 $504,100 Liabilities and Shareholders' Equity Accounts payable $40,900 $36,500 Dividends payable 6,100 4,600 Income taxes payable 1,800 5,600 Mortgage paya 118,000 76,500 Common shares 212,000 162,500 Retained earnings 274,625 218,400 Total liabilities and shareholders' equity $653,425 $504,100 Additional Information: 1. Profit for 2021 was $115,725. 2. Common shares were issued for $49,500. 3. Land with a cost of $49,500 was sold at a loss of $18,600. 4. Purchased land with a cost of $96,000 with a $54,500 down payment and financed the remainder with a mortgage note payable. 5. No equipment was sold during 2021. 6. Net sales for the year were $672,200. 7. Cost of goods sold for the year was $398,400. 8. Operating costs, including depreciation expense, were $96,300. 9. Interest expense was $4,600. 10. Income tax expense was $38,575. 11. Accounts payable is used for merchandise purchases