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linv08 linv08
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A month ago
Wil Wheaton, Kirk Enterprises' controller, is preparing the financial statements for 2021 as follows.

Kirk Enterprises
Comparative Balance Sheets
As of December 31
2021 2020
Cash$122,300 $80,500
Accounts receivable, net287,200269,700
Inventory125,00095,000
Total current assets534,500445,200
Property, plant, & equipment, net297,000160,000
Accumulated depreciation 90,00060,000
  Net property, plant, & equipment207,000100,000
Total Assets$741,500 $545,200
Accounts payable$150,000$175,000
Taxes payable17,60020,000
Mortgage payable110,000             0
  Total liabilities277,600195,000
Common stock350,000290,000
Retained earnings113,90060,200
  Total stockholders' equity463,900350,200
Total liabilities & stockholders' equity$741,500 $545,200


Kirk Enterprises
Income Statement
For the Year Ended December 31, 2021
Sales revenue$1,070,000
Cost of goods sold700,000
Operating expenses
  Depreciation expense$  42,000
  Interest expense7,400
  Wages expenses175,000
  Other expenses   16,000   240,400
Income before taxes129,600
Loss on equipment sale3,000
Tax expense     63,400
  Net income$     63,200


He has gathered this additional information:

On December 31, 2021, Kirk sold a piece of equipment with an original cost of
$25,000
for $10,000 cash. The equipment had a book value of $13,000.
On February 1, 2021, Kirk issued $60,000 of common stock to raise cash in
anticipation
of the purchase of a new building later in the year.
On February 2, 2021, Kirk took out a ten-year $110,000 long-term loan to provide the
remaining funds needed to purchase the building.
On May 15, 2021, Kirk paid $162,000 for the new building.
The company paid a cash dividend of $9,500.

Required:
Using the indirect method, prepare Kirk Enterprises' statement of cash flows for 2021.
Textbook 

Managerial Accounting


Edition: 4th
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edwardssheedwardsshe
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A month ago
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Kirk Enterprises
Statement of Cash Flows
For the year ended December 31, 2021
Cash flows from operating activities
Net income$63,200
Adjustments to net income
  Depreciation$42,000
  Loss on sale of equipment3,000
  Increase in accounts receivable(17,500)
  Increase in inventories(30,000)
  Decrease in accounts payable(25,000)
  Decrease in income taxes payable    (2,400)(29,900)
    Net cash provided by operating activities33,300
Cash flows from investing activities
Sale of equipment10,000
Purchase of equipment(162,000)
    Net cash provided by investing activities(152,000)

Cash flows from financing activities
Proceeds from issuing common stock60,000
Proceeds from long-term debt110,000
Payment of cash dividend   (9,500)
    Net cash provided by financing activities  160,500

Change in cash41,800
Cash, beginning balance    80,500
Cash, ending balance$122,300


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linv08 Author
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A month ago
Correct Slight Smile TY
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Thanks for your help!!
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this is exactly what I needed
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