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. The income statement, balance sheets, and additional information for Virtual Gaming Systems are provided. $2,530,000 3,500 2,533,500 VIRTUAL GAMING SYSTEMS Income Statement For the
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The income statement, balance sheets, and additional information for Virtual Gaming Systems are provided. $2,530,000 3,500 2,533,500 VIRTUAL GAMING SYSTEMS Income Statement For the year ended December 31, 2021 Net sales Gain on sale of land Total revenues Expenses: Cost of goods sold $1,615,000 Operating expenses 608,000 Depreciation expense 26,000 Interest expense 27,000 Income tax expense 73,000 Total expenses Net income 2,349,000 $ 184,500 VIRTUAL GAMING SYSTEMS Balance Sheets December 31 2021 2020 $ 265,120 71,700 149,500 4,180 $ 206,940 87,000 138,000 6,360 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investments Land Equipment Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities: Notes payable Stockholders' equity: Common stock Retained earnings Total liabilities and stockholders' equity 188,000 211,500 236,000 (132,500) $ 993,500 100,000 263,000 213,000 (106,500) $ 907,800 $ $ 31,500 4,300 22,200 91,000 3,300 25,500 251,000 228,000 383,000 330,000 301,500 230,000 $ 993,500 $ 907,800 Additional Information for 2021: 1. Purchase additional investment in stocks for $88,000. 2. Sell land costing $51,500 for $55,000, resulting in a $3,500 gain on sale of land. 3. Purchase $23,000 in equipment by issuing a $23,000 long-term note payable to the seller. No cash is exchanged in the transaction. 4. Declare and pay a cash dividend of $113,000. 5. Issue common stock for $53,000. Deauired. Required: Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note. (List cash outflows and any decrease in cash as negative amounts.) VIRTUAL GAMING SYSTEMS Statement of Cash Flows For the Year Ended December 31, 2021 Cash Flows from Operating Activities Adjustments to reconcile net income to net cash flows from operating activities: Net cash flows from operating activities Cash Flows from Investing Activities Net cash flows from operating activities Cash Flows from Investing Activities Net cash flows from investing activities Cash Flows from Financing Activities Net cash flows from financing activities Cash at the beginning of the period Cash at the end of the period Note: Noncash ActivitiesStep by Step Solution
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