Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Using the financial data below, prepare a statement of cash flows for the year ended December 31, 2014 for Summer Peebles, Inc. using the indirect

Using the financial data below, prepare a statement of cash flows for the year ended December 31, 2014 for Summer Peebles, Inc. using the indirect method.

Summer Peebles, Inc. Income Statement Year Ending December 31, 2014

Sales

$1,000.00

Cost of Goods Sold

-$650.00

Depreciation Expense

-$100.00

Sales and General Expense

-$100.00

Interest Expense

-$50.00

Income Tax Expense

-$40.00

Net Income

$60.00

Summer Peebles, Inc. Balance Sheets as of December 31, 2013 and 2014

Assets

2013

2014

Cash

$50.00

$60.00

Accounts Receivable, Net

$500.00

$520.00

Inventory

$750.00

$770.00

Current Assets

$1,300.00

$1,350.00

Fixed Assets, Net

$500.00

$550.00

Total Assets

$1,800.00

$1,900.00

Liabilities and Equity

Notes Payable to Banks

$100.00

$75.00

Accounts Payable

$590.00

$615.00

Interest Payable

$10.00

$20.00

Current Liabilities

$700.00

$710.00

Long-Term Debt

$300.00

$350.00

Deferred Income Tax

$300.00

$310.00

Capital Stock

$400.00

$400.00

Additional data for the period January 1, 2014 through December 31, 2014 are:

  1. Sales on account, $70,000.
  2. Purchases on account, $40,000.
  3. Depreciation, $5,000.
  4. Expenses paid in cash, $18,000 (including $4,000 of interest and $6,000 in taxes).
  5. Decrease in inventory, $2,000.
  6. Sales of fixed assets for $6,000 cash; cost $21,000 and two-thirds depreciated (loss or gain is included in income).
  7. Purchase of fixed assets for cash, $4,000.
  8. Fixed assets are exchanged for bonds payable of $30,000.
  9. Sale of investments for $9,000 cash.
  10. Purchase of treasury stock for cash, $11,500.
  11. Retire bonds payable by issuing common stock, $10,000.
  12. Collections on accounts receivable, $65,000.
  13. Sold unissued common stock for cash, $1,000.

please show calculations.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting For Non Specialists

Authors: Catherine Gowthorpe

2nd Edition

1844802051, 978-1844802050

More Books

Students also viewed these Accounting questions

Question

1. What would you do if you were Jennifer, and why?

Answered: 1 week ago