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The Extra Surplus Company's Balance Sheet for December 31, 2017 and the Income Statement for 2018 are shown below. Extra Surplus Company Balance Sheet
The Extra Surplus Company's Balance Sheet for December 31, 2017 and the Income Statement for 2018 are shown below. Extra Surplus Company Balance Sheet Cash December 31, 2017 Assets $13,500 Accounts Receivable 6,750 Inventory 16,200 Property and Equipment, Net 27,000 $63,450 Liabilities and Stockholders' Equity Accounts Payable $13,500 Notes Payable, Long-Term 6,750 Common Stock 27,000 Retained Earnings 16,200 $63,450 Extra Surplus Company Income Statement For the Year Ended December 31, 2018 Sales Cost of Goods Sold Salaries and Wage Expense Interest Expense Other Expenses Net Income $22,100 5,100 5,100 1,700 850 $ 9,350 Additional data: Sales were $22,100; $13,600 in cash was received from customers. Bought new land for cash, $17,000. Sold other land for its book value of $8,500. Paid $1,700 principal on the long-term note payable and $1,700 in interest. Issued new shares of stock for $17,000 cash. Cash dividends of $2,400 were declared and paid to stockholders. Paid $9,700 on accounts payable. No inventory purchases were made; other expenses were incurred on account. All wages were paid in cash. Other expenses were on account. Required: a. Prepare a balance sheet at December 31, 2018. b. Prepare the statement of cash flows using the direct method.
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