The comparative balance sheet of Yellow Dog Enterprises Inc. atDecember 31, 20Y8 and 20Y7, is as follows:
1 | | Dec. 31, 20Y8 | Dec. 31, 20Y7 |
2 | Assets | | |
3 | Cash | $146,480.00 | $179,640.00 |
4 | Accounts receivable (net) | 225,010.00 | 241,920.00 |
5 | Merchandise inventory | 321,600.00 | 298,870.00 |
6 | Prepaid expenses | 13,030.00 | 10,420.00 |
7 | Equipment | 654,380.00 | 537,900.00 |
8 | Accumulated depreciation | (169,970.00) | (133,130.00) |
9 | Total assets | $1,190,530.00 | $1,135,620.00 |
10 | Liabilities and Stockholders’ Equity | | |
11 | Accounts payable (merchandise creditors) | $250,960.00 | $236,720.00 |
12 | Mortgage note payable | ????0.00 | 335,410.00 |
13 | Common stock, $10 par | 75,000.00 | 25,000.00 |
14 | Paid-in capital: Excess of issue price over par—common stock | 440,000.00 | 310,000.00 |
15 | Retained earnings | 424,570.00 | 228,490.00 |
16 | Total liabilities and stockholders’ equity | $1,190,530.00 | $1,135,620.00 |
Additional data obtained from the income statement and from anexamination of the accounts in the ledger for 20Y8 are asfollows:
| A. | Net income, $348,560. |
| B. | Depreciation reported on the income statement, $82,480. |
| C. | Equipment was purchased at a cost of $162,120 and fullydepreciated equipment costing $45,640 was discarded, with nosalvage realized. |
| D. | 10,000 shares of common stock were issued at $18 for cash. |
| E. | The mortgage note payable was not due for six years, but theterms permitted earlier payment without penalty. |
| F. | Cash dividends declared and paid, $152,480. |
Prepare a statement of cash flows, using the indirect method ofpresenting cash flows from operating activities. Refer to theLabels and Amount Descriptions list provided for the exact wordingof the answer choices for text entries. Be sure to complete theheading of the statement. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negativeadjustments.
Labels and Amount Descriptions | |
| Cash used for dividends | |
| Cash used for equipment | |
| Cash used for merchandise | |
| |
| Cash used for purchase of land | |
| Cash used to retire mortgage note payable | |
| Cash from customers | |
| Cash from sale of common stock | |
| December 31, 20Y8 | |
| Decrease in cash | |
| Decrease in merchandise inventory | |
| Decrease in accounts payable | |
| Decrease in accounts receivable | |
| Decrease in prepaid expenses | |
| Depreciation | |
| For the Year Ended December 31, 20Y8 | |
| Gain on disposal of equipment | |
| Gain on sale of investments | |
| Increase in accounts payable | |
| Increase in accounts receivable | |
| Increase in cash | |
| Increase in merchandise inventory | |
| Increase in prepaid expenses | |
| Loss on disposal of equipment | |
| Loss on sale of investments | |
| Net cash flow from financing activities | |
| Net cash flow from investing activities | |
| Net cash flow from operating activities | |
| Net cash flow used for financing activities | |
| Net cash flow used for investing activities | |
| Net cash flow used for operating activities | |
| Net income | |
| Net loss |
