The comparative balance sheet of Merrick Equipment Co. for Dec. 31, 20Y9 and 20Y8, is:Dec. 31, 20Y9 Dec. 31, 20Y8AssetsCash $70,720 $47,940Accounts receivable (net) 207,230 188,190Inventories 298,520 289,850Investments 0 102,000Land 295,800 0Equipment 438,600 358,020Accumulated depreciation—equipment (99,110) (84,320)Total assets $1,211,760 $901,680Liabilities and Stockholders' EquityAccounts payable (merchandise creditors) $205,700 $194,140Accrued expenses payable (operating expenses) 30,600 26,860Dividends payable 25,500 20,400Common stock, $1 par 202,000 102,000Paid-in capital: Excess of issue price over par—common stock 354,000 204,000Retained earnings 393,960 354,280Total liabilities and stockholders' equity $1,211,760 $901,680The income statement for the year ended December 31, 20Y9, is as follows:Sales $2,023,898Cost of goods sold 1,245,476Gross profit $778,422Operating expenses:Depreciation expense $14,790Other operating expenses 517,299Total operating expenses 532,089Operating income $246,333Other expenses:Loss on sale of investments (10,200)Income before income tax $236,133Income tax expense 94,453Net income $141,680Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows:a. Equipment and land were acquired for cash.b. There were no disposals of equipment during the year.c. The investments were sold for $91,800 cash.d. The common stock was issued for cash.e. There was a $102,000 debit to Retained Earnings for cash dividends declared.Required:Prepare a statement of cash flows, using the direct method of presenting cash flows from operatingactivities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negativeadjustments.
The comparative balance sheet of Merrick Equipment Co. for Dec. 31, 20Y9 and 20Y8, is:
Dec. 31, 20Y9 Dec. 31, 20Y8
Assets
Cash $70,720 $47,940
Accounts receivable (net) 207,230 188,190
Inventories 298,520 289,850
Investments 0 102,000
Land 295,800 0
Equipment 438,600 358,020
Accumulated depreciation—equipment (99,110) (84,320)
Total assets $1,211,760 $901,680
Liabilities and
Accounts payable (merchandise creditors) $205,700 $194,140
Accrued expenses payable (operating expenses) 30,600 26,860
Dividends payable 25,500 20,400
Common stock, $1 par 202,000 102,000
Paid-in capital: Excess of issue price over par—common stock 354,000 204,000
Total liabilities and stockholders' equity $1,211,760 $901,680
The income statement for the year ended December 31, 20Y9, is as follows:
Sales $2,023,898
Cost of goods sold 1,245,476
Gross profit $778,422
Operating expenses:
Depreciation expense $14,790
Other operating expenses 517,299
Total operating expenses 532,089
Operating income $246,333
Other expenses:
Loss on sale of investments (10,200)
Income before income tax $236,133
Income tax expense 94,453
Net income $141,680
Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows:
a. Equipment and land were acquired for cash.
b. There were no disposals of equipment during the year.
c. The investments were sold for $91,800 cash.
d. The common stock was issued for cash.
e. There was a $102,000 debit to Retained Earnings for cash dividends declared.
Required:
Prepare a statement of
activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative
adjustments.
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