P13-9A_Sinjh Inc._Cash_Flow Statement
P13-9A Condensed financial data of sinjh Inc. follow.
| Sinjh Inc. | ||||
| Comparative Balance Sheets | ||||
| December 31 | ||||
| Assets | 2014 2013 | |||
| Cash | $100,350 $ 48,400 | |||
| Accounts receivable | 92,800 33,000 | |||
| Inventory | 112,500 102,850 | |||
| Prepaid expenses | 29,300 26,000 | |||
| Long-term investments | 140,000 114,000 | |||
| Plant assets | 265,000 242,500 | |||
| Accumulated depreciation | (47,000) (52,000) | |||
| Total | $692,950 $514,750 | |||
| Liabilities and Stockholders’ Equity | ||||
| Accounts payable | $112,000 $ 67,300 | |||
| Accrued expenses payable | 16,500 17,000 | |||
| Bonds payable | 110,000 150,000 | |||
| Common stock | 220,000 175,000 | |||
| Retained earnings | 234,450 105,450 | |||
| Total | $692,950 $514,750 | |||
| Sinjh Inc | ||||
| Sales revenue
Gain on disposal of plant assets |
$392,780
5,000 |
|||
| Less: | ||||
| Cost of goods sold | 135,460 | |||
| Operating expenses, excluding | ||||
| depreciation | 12,410 | |||
| Depreciation expense | 45,000 | |||
| Income tax expense | 27,280 | |||
| Interest expense | 4,730 224,880 | |||
| Net income | $172,900 |
Additional information:
1. New plant assets costing $80,000 were purchased for cash during the year.
2. Old plant assets having an original cost of $57,500 and accumulated depreciation of $50,000 were sold for $12,500 cash.
3. Bonds payable matured and were paid off at face value for cash.
4. A cash dividend of $43,900 was declared and paid during the year,
Instructions
Prepare a statement of cash flows using the indirect method.
P13-10A – Data for Sigh Inc. are presented in P13-9A. Further analysis reveals that accounts payable pertains to Merchandise Creditors.
Prepare a statement of cash flows using the direct method.