Exercise 23-12Condensed financial data of Headland Company for 2017 and 2016are presented below.HEADLAND...Exercise 23-12Condensed...

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Accounting

Exercise 23-12
Condensed financial data of Headland Company for 2017 and 2016are presented below.
HEADLAND COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2017 AND 2016
2017
2016
Cash
$1,810
$1,120
Receivables
1,790
1,330
Inventory
1,570
1,940
Plant assets
1,870
1,740
Accumulated depreciation
(1,230
)
(1,150
)
Long-term investments (held-to-maturity)
1,300
1,440
$7,110
$6,420
Accounts payable
$1,220
$910
Accrued liabilities
200
260
Bonds payable
1,370
1,550
Common stock
1,860
1,740
Retained earnings
2,460
1,960
$7,110
$6,420
HEADLAND COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2017
Sales revenue
$6,810
Cost of goods sold
4,680
Gross margin
2,130
Selling and administrative expenses
920
Income from operations
1,210
Other revenues and gains
Gain on sale of investments
80
Income before tax
1,290
Income tax expense
530
Net income 760
Cash dividends
260
Income retained in business
$500

Additional information:

During the year, $70 of common stock was issued in exchange forplant assets. No plant assets were sold in 2017.

Prepare a statement of cash flows using the direct method.(Show amounts in the investing and financing sectionsthat decrease cash flow with either a - sign e.g. -15,000 or inparenthesis e.g. (15,000).)

Answer & Explanation Solved by verified expert

3.7 Ratings (430 Votes)

H COMPANY Statement of Cash Flows For the Year Ended December 31 2017 Direct Method Cash Flows from Operating Activities Cash receipts from customers 6350 Cash paid for merchandise 4000 Cash paid for sellingadministrative expenses 900 Cash paid See Answer

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Transcribed Image Text

In: AccountingExercise 23-12Condensed financial data of Headland Company for 2017 and 2016are presented below.HEADLAND...Exercise 23-12Condensed financial data of Headland Company for 2017 and 2016are presented below.HEADLAND COMPANYCOMPARATIVE BALANCE SHEETAS OF DECEMBER 31, 2017 AND 201620172016Cash$1,810$1,120Receivables1,7901,330Inventory1,5701,940Plant assets1,8701,740Accumulated depreciation(1,230)(1,150)Long-term investments (held-to-maturity)1,3001,440$7,110$6,420Accounts payable$1,220$910Accrued liabilities200260Bonds payable1,3701,550Common stock1,8601,740Retained earnings2,4601,960$7,110$6,420HEADLAND COMPANYINCOME STATEMENTFOR THE YEAR ENDED DECEMBER 31, 2017Sales revenue$6,810Cost of goods sold4,680Gross margin2,130Selling and administrative expenses920Income from operations1,210Other revenues and gains Gain on sale of investments80Income before tax1,290Income tax expense530Net income760Cash dividends260Income retained in business$500Additional information:During the year, $70 of common stock was issued in exchange forplant assets. No plant assets were sold in 2017.Prepare a statement of cash flows using the direct method.(Show amounts in the investing and financing sectionsthat decrease cash flow with either a - sign e.g. -15,000 or inparenthesis e.g. (15,000).)

HEADLAND COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016
	2017		2016
Cash	$1,810		$1,120
Receivables	1,790		1,330
Inventory	1,570		1,940
Plant assets	1,870		1,740
Accumulated depreciation	(1,230	)	(1,150	)
Long-term investments (held-to-maturity)	1,300		1,440
	$7,110		$6,420

Accounts payable	$1,220		$910
Accrued liabilities	200		260
Bonds payable	1,370		1,550
Common stock	1,860		1,740
Retained earnings	2,460		1,960
	$7,110		$6,420

HEADLAND COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017
Sales revenue		$6,810
Cost of goods sold		4,680
Gross margin		2,130
Selling and administrative expenses		920
Income from operations		1,210
Other revenues and gains
Gain on sale of investments		80
Income before tax		1,290
Income tax expense		530
Net income		760
Cash dividends		260
Income retained in business		$500