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The income statement, balance sheets, and additional information for Video Phones, Inc., are provided. VIDEO PHONES, INC. Income Statement For the Year Ended December 31,

The income statement, balance sheets, and additional information for Video Phones, Inc., are provided.

VIDEO PHONES, INC.
Income Statement
For the Year Ended December 31, 2021
Net sales $ 2,886,000
Expenses:
Cost of goods sold $ 1,800,000
Operating expenses 828,000
Depreciation expense 24,000
Loss on sale of land 7,700
Interest expense 13,500
Income tax expense 45,000
Total expenses 2,718,200
Net income $

167,800

VIDEO PHONES, INC.
Balance Sheets
December 31
2021 2020
Assets
Current assets:
Cash $ 196,620 $ 119,460
Accounts receivable 77,700 57,000
Inventory 105,000 132,000
Prepaid rent 10,080 5,040
Long-term assets:
Investments 102,000 0
Land 207,000 234,000
Equipment 264,000 207,000
Accumulated depreciation (65,400 ) (41,400 )
Total assets $ 897,000 $ 713,100
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 63,300 $ 78,000
Interest payable 5,700 9,400
Income tax payable 14,700 13,700
Long-term liabilities:
Notes payable 279,000 222,000
Stockholders' equity:
Common stock 270,000 270,000
Retained earnings 264,300 120,000
Total liabilities and stockholders equity $ 897,000 $ 713,100

Additional Information for 2021:

  1. Purchase investment in bonds for $102,000.
  2. Sell land costing $27,000 for only $19,300, resulting in a $7,700 loss on sale of land.
  3. Purchase $57,000 in equipment by issuing a $57,000 long-term note payable to the seller. No cash is exchanged in the transaction.
  4. Declare and pay a cash dividend of $23,500.

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.)

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The income statement, balance sheets, and additional information for Video Phones, Inc., are provided VIDEO PHONES, INC Income Statement For the Year Ended December 31, 2021 Net sales $2,886,000 Expenses: Cost of goods sold Operating expenses Depreciation expense $1,800,000 828,000 24,000 7,700 13,500 Loss on sale of land Interest expense 45,000 Income tax expense Total expenses 2,718,200 Net income 167,800 VIDEO PHONES, INC Balance Sheets December 31 2021 2020 Assets Current assets: Cash $196,620 77,700 105,000 $119,460 57,000 Accounts receivable 132,000 5,040 Inventory Prepaid rent Long-term assets: 10,080 102,000 207,000 264,000 (65,400) 0 Investments 234,000 207,000 (41,400) Land Equipment Accumulated depreciation $897,000 Total assets $713,100 Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities Notes payable Stockholders' equity: 63,300 5,700 14,700 $78,000 9,400 13,700 279,000 222,000 Common stock 270,000 264,300 270,000 120,000 Retained earnings Total liabilities and stockholders equity $897,000 $713,100 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 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 Activities

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