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Posts: 138
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A year ago
Wil Wheaton, Kirk Enterprises' controller, is preparing the financial statements for 2021 as follows. | Comparative Balance Sheets |
| Accounts receivable, net | 287,200 | 269,700 |
| Total current assets | 534,500 | 445,200 |
| Property, plant, & equipment, net | 297,000 | 160,000 |
| Accumulated depreciation | 90,000 | 60,000 |
| Net property, plant, & equipment | 207,000 | 100,000 |
| Total Assets | $741,500 | $545,200 |
| Accounts payable | $150,000 | $175,000 |
| Taxes payable | 17,600 | 20,000 |
| Mortgage payable | 110,000 | 0 |
| Total liabilities | 277,600 | 195,000 |
| Common stock | 350,000 | 290,000 |
| Retained earnings | 113,900 | 60,200 |
| Total stockholders' equity | 463,900 | 350,200 |
| Total liabilities & stockholders' equity | $741,500 | $545,200 |
| For the Year Ended December 31, 2021 | |
| Cost of goods sold | 700,000 |
Operating expenses | Depreciation expense | $ 42,000 |
| Other expenses | 16,000 | 240,400 |
| Income before taxes | 129,600 |
| Loss on equipment sale | 3,000 |
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.
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