Question
SMART CORPORATION Balance Sheets At December 31 2010 2009 Assets: Cash $ 24,640 $ 23,040 Accounts receivable 32,180 29,400 Merchandise inventory 73,125 61,710 Long-term investments
SMART CORPORATION Balance Sheets At December 31 | ||
| 2010 | 2009 |
Assets: |
|
|
Cash | $ 24,640 | $ 23,040 |
Accounts receivable | 32,180 | 29,400 |
Merchandise inventory | 73,125 | 61,710 |
Long-term investments | 55,900 | 56,400 |
Equipment | 175,500 | 145,500 |
Accumulated depreciation | (33,550) | (31,200) |
Total assets | $327,795 | $284,850 |
|
|
|
Liabilities: |
|
|
Accounts payable | $ 65,000 | $40,380 |
Income taxes payable | 10,725 | 10,200 |
Bonds payable | 48,750 | 66,000 |
Total liabilities | $124,475 | $116,580 |
Equity: |
|
|
Common stock | 117,000 | 96,000 |
Contributed capital in excess of par | 13,000 | 9,000 |
Retained earnings | 73,320 | 63,270 |
Total equity | $203,320 | $168,270 |
Total liabilities and equity | $327,795 | $284,850 |
SMART CORPORATION Income Statement For Year Ended December 31, 2013 | ||
Sales |
| $240,000 |
Cost of goods sold | $80,900 |
|
Depreciation expense | 29,400 |
|
Other operating expenses | 48,000 |
|
Interest expense | 2,000 | (160,300) |
Other gains (losses): |
|
|
Loss on sale of equipment |
| (8,400) |
Income before taxes |
| 71,300 |
Income taxes expense |
| (27,650) |
Net income |
| $ 43,650 |
Exercise: (30%) The following information is available for the Smart Corporation:
Additional information: (1) There was no gain or loss on the sales of the long-term investments, nor on the bonds retired. (2) Old equipment with an original cost of $37,550 was sold for $2,100 cash. (3) New equipment was purchased for $67,550 cash.
(4) Cash dividends of $33,600 were paid. (5) Additional shares of stock were issued for cash. Required: Prepare a complete statement of cash flows for the 2010 calendar year using the direct method.
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