Intermidiate Accounting II 18) The following information is reported on...
80.2K
Verified Solution
Link Copied!
Question
Accounting
Intermidiate Accounting II
18) The following information is reported on the comparative balance sheet and income statement of Cashwealth Corp for the year ended Dec 31, Year 8. Prepare the operating section of the statement of cash flows under BOTH the INDIRECT method AND the DIRECT method. 110 points for each method BALANCE SHEET Year 8 Year 2 ASSETS Cash 23,000 30,000 Accounts Receivable 260,000 240,000 Merchandise Inventory 32,000 36,000 Prepaid Insurance 16,000 4,000 Equipment 25,000 50,000 Accumulated Depreciation (11,000) 19,000) 345,000 351,000 LIABILITIES AND STOCKHOLDERS' EQUTY Accounts Payable 42,000 53,000 Salaries Payble 20,000 15,000 Bonds Payable 150,000 150,000 Premium on Bonds Payable 12,000 17,000 Common Stock 75,000 75,000 Retained Earnings 46,000 41,000 345,000 351,000 INCOME STATEMENT Additional information Sales 600,000 Dividends were declared and paid during year 8. Cost of goods sold (400,000) Accounts payable pertains to inventory only Operating expenses (60,000) Operating expenses includes depreciation expense. Salaries Expense (100,000) Equipment costing $25,000 was sold for $20,000 cash Interest Expense (30,000) at a gain. Gain on sale of equipment 5,000 Net Income 15,000 INDIRECT METHOD DIRECT METHOD
Answer & Explanation
Solved by verified expert
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
