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VIDEO PHONES, INC. Income Statement For the Year Ended December 31, 2021 3 Net sales $3,336,000 Expenses: Cost of goods sold $2,150,000 898,000 31,000 8,400
VIDEO PHONES, INC. Income Statement For the Year Ended December 31, 2021 3 Net sales $3,336,000 Expenses: Cost of goods sold $2,150,000 898,000 31,000 8,400 Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense Total expenses Net income 17,000 52,000 3,156,400 $ 179,600 2020 $177,520 64,000 139,000 6,480 248,000 214,000 (42,800) $806, 200 VIDEO PHONES, INC. Balance Sheets December 31 2021 Assets Current assets: Cash $ 273,440 Accounts 85,400 receivable Inventory 105,000 Prepaid rent 12,960 Long-term assets: Investments 109,000 Land 214,000 Equipment 278,000 Accumulated (73,800) depreciation Total assets $1,004,000 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 69,600 Interest payable 6,400 Income tax 15,400 payable Long-term liabilities: Notes payable 293,000 Stockholders' equity: Common stock 340,000 Retained earnings 279,600 Total liabilities and $1,004,000 stockholders' equity $ 85,000 10,800 14,400 229,000 340,000 127,000 $806,200 Additional Information for 2021: 1. Purchase investment in bonds for $109,000. 2. Sell land costing $34,000 for only $25,600, resulting in a $8,400 loss on sale of land. 3. Purchase $64,000 in equipment by issuing a $64,000 long-term note payable to the seller. No cash is exchanged in the transaction. 4. Declare and pay a cash dividend of $27,000. 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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