The statement of income and unclassified statement of financial position for E-Perform, Inc. follow: E-PERFORM, INC. Statement of Financial Position December 31 2021 Assets 2020 Cash $97,800 $48,400 128,000 114,000 75,800 43,000 120,300 91.150 Trading investments Accounts receivable Inventory Estimated inventory returns Prepaid expenses Equipment Accumulated depreciation 2,200 1,700 18,400 26.000 270,000 242.500 (50,000) (52,000) Total assets $662,500 $514,750 Liabilities and Shareholders' Equity Accounts payable $93,000 $77,300 Property tax payable 10,500 6,200 Refund liability 1,000 800 Bank loan payable-current portion 86,000 130,000 Bank loan payable-noncurrent portion 24,000 20,000 Common shares 200,000 175,000 Retained earnings 248,000 105,450 Total liabilities and shareholders' equity $662,500 $514.750 E-PERFORM, INC. Statement of Income Year Ended December 31, 2021 Sales $492.780 Cost of goods sold 185,460 Gross profit 307,320 Operating expenses 116,410 Income from operations 190,910 Other income and expenses Unrealized gain on trading investments $14,000 Interest expense (4.730) 9.270 Income before income tax 200,180 Income tax expense 45,000 Net income $155.180 Additional information regarding 2021: 1 2. 3. 4. 5. Prepaid expenses and property tax payable relate to operating expenses. New equipment costing $85,000 was purchased for $25,000 cash and a $60,000 long-term bank loan payable. Old equipment having an original cost of $57,500 was sold for $1,500 Accounts payable relate to inventory suppliers. Some of the bank loan was repaid during the year. A dividend was paid during the year. Operating expenses include $46,500 of depreciation expense and a $7,500 loss on disposal of equipment. Common shares were issued for $40,000 cash during the year and some common shares werebought back and retired at the cost they were originally issued at. 6. 7. 8. E-PERFORM, INC. Statement of Cash Flows-Direct Method Year Ended December 31, 2021 Cash flows from operating activities Cash receipts from customers $ 459980 Cash Payments To suppliers Cath January 1 Cast December 31 $ by Note X to the Statement of Cash Flows: During the year, the company purchased equipment costing $ paying $25.000 cash and issuing a $60,000 bank loan payable