Question
The following transactions apply to Mabry Equipment Sales Corp. for 2012: 1. The business was started when Mabry Corp. received $49,500 from the issue of
The following transactions apply to Mabry Equipment Sales Corp. for 2012: 1. The business was started when Mabry Corp. received $49,500 from the issue of common stock. 2. Purchased $176,500 of merchandise on account. 3. Sold merchandise for $199,000 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $124,000. 4. Provided a six-month warranty on the merchandise sold. Based on industry estimates, the warranty claims would amount to 3 percent of merchandise sales. 5. Paid the sales tax to the state agency on $149,000 of the sales. 6. On September 1, 2012, borrowed $21,000 from the local bank. The note had a 6 percent interest rate and matures on March 1, 2013. 7. Paid $5,800 for warranty repairs during the year. 8. Paid operating expenses of $53,000 for the year. 9. Paid $125,700 of accounts payable. 10. Recorded accrued interest at the end of the year.
PREPARE THE STATEMENT OF CASH FLOWS FOR 2012
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