Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Dux Company. Additional information from Duxs

The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Dux Company. Additional information from Duxs accounting records is provided also.

DUX COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands)
2021 2020
Assets
Cash $ 129.0 $ 36.0
Accounts receivable 64.0 66.0
Less: Allowance for uncollectible accounts (5.0 ) (4.0 )
Dividends receivable 19.0 18.0
Inventory 71.0 66.0
Long-term investment 31.0 26.0
Land 86.0 40.0
Buildings and equipment 161.0 266.0
Less: Accumulated depreciation (6.0 ) (130.0 )
$ 550.0 $ 384.0
Liabilities
Accounts payable $ 29.0 $ 36.0
Salaries payable 18.0 21.0
Interest payable 20.0 18.0
Income tax payable 23.0 24.0
Notes payable 46.0 0
Bonds payable 91.0 50.0
Less: Discount on bonds (2.0 ) (3.0 )
Shareholders' Equity
Common stock 210.0 200.0
Paid-in capitalexcess of par 24.0 20.0
Retained earnings 99.0 18.0
Less: Treasury stock (8.0 ) 0
$ 550.0 $ 384.0

DUX COMPANY Income Statement For the Year Ended December 31, 2021 ($ in thousands)
Revenues
Sales revenue $ 440.0
Dividend revenue 19.0 $ 459.0
Expenses
Cost of goods sold 152.0
Salaries expense 57.0
Depreciation expense 2.0
Bad debt expense 1.0
Interest expense 40.0
Loss on sale of building 35.0
Income tax expense 48.0 335.0
Net income $ 124.0

Additional information from the accounting records:

  1. A building that originally cost $168,000, and which was three-fourths depreciated, was sold for $7,000.
  2. The common stock of Byrd Corporation was purchased for $5,000 as a long-term investment.
  3. Property was acquired by issuing a 13%, seven-year, $46,000 note payable to the seller.
  4. New equipment was purchased for $63,000 cash.
  5. On January 1, 2021, bonds were sold at their $41,000 face value.
  6. On January 19, Dux issued a 5% stock dividend (1,000 shares). The market price of the $10 par value common stock was $14 per share at that time.
  7. Cash dividends of $29,000 were paid to shareholders.
  8. On November 12, 12,500 shares of common stock were repurchased as treasury stock at a cost of $8,000.

Required: Prepare the statement of cash flows for Dux Company using the indirect method. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands (i.e., 10,000 should be entered as 10).)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The ASQ Auditing Handbook

Authors: J. P. Russell,

4th Edition

0873898478, 978-0873898478

More Books

Students also viewed these Accounting questions