A comparative statement of financial position for Sheffield Industries Inc. follows: SHEFFIELD INDUSTRIES INC. Statement of Financial Position December 31,...

80.2K

Verified Solution

Question

Accounting

A comparative statement of financial position for SheffieldIndustries Inc. follows:
SHEFFIELDINDUSTRIES INC.
Statement of Financial Position
December 31, 2020
December31
Assets 2020 2019
Cash $22,500 $35,500
Accounts receivable 117,000 55,300
Inventory 231,000 199,000
Land 86,000 130,000
Equipment 278,000 204,000
Accumulateddepreciation—equipment (70,500 ) (42,900 )
Total $664,000 $580,900
Liabilities andShareholders’ Equity
Accounts payable $52,700 $60,200
Bonds payable 164,400 218,400
Common shares 234,000 180,000
Retained earnings 212,900 122,300
Total $664,000 $580,900

Additional information:
1. Net income for the fiscalyear ending December 31, 2020, was $142,000.
2. Cash dividends of $51,400were declared and paid. Dividends paid are treated as financingactivities.
3. Bonds payable amounting to$54,000 were retired through issuance of common shares.
4. Land was sold at a gain of$3,000.
5. No equipment was sold duringthe year.

(a) Prepare a statement of cash flowsusing the indirect method.

Answer & Explanation Solved by verified expert

4.4 Ratings (733 Votes)

Solution SHEFFIELD INDUSTRIES INC Cash Flow Statement For the Year Ended December 31 2020 Cash Flow from Operating Activities Net Income 14200000 Adjustments to reconcile net income to net cash flow from operating activities Gain on sale of land 300000 Depreciation expense 2760000 Changes in See Answer

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!

Become a Member

SHEFFIELDINDUSTRIES INC. Statement of Financial Position December 31, 2020
	December31
Assets	2020		2019
Cash	$22,500		$35,500
Accounts receivable	117,000		55,300
Inventory	231,000		199,000
Land	86,000		130,000
Equipment	278,000		204,000
Accumulateddepreciation—equipment	(70,500	)	(42,900	)
Total	$664,000		$580,900

Liabilities andShareholders’ Equity
Accounts payable	$52,700		$60,200
Bonds payable	164,400		218,400
Common shares	234,000		180,000
Retained earnings	212,900		122,300
Total	$664,000		$580,900

1.		Net income for the fiscalyear ending December 31, 2020, was $142,000.
2.		Cash dividends of $51,400were declared and paid. Dividends paid are treated as financingactivities.
3.		Bonds payable amounting to$54,000 were retired through issuance of common shares.
4.		Land was sold at a gain of$3,000.
5.		No equipment was sold duringthe year.