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Problem 23-4

*Problem 23-4 Indigo Company had the following information available at the end of 2017 INDIGOCOMPANY COMPARATIVE BALANCE SHEETS AS OF DECEMBER 31, 2017 AND 2016 2017 2016 Cash Accounts receivable Short-term investments Inventory Prepaid rent Prepaid insurance Supplies Land Buildings Accumulated depreciation-buildings Equipment Accumulated depreciation-equipment Patents $3,990 12,850 30,060 35,280 12,030 90 75 124,150 175,280 349,500 349,500 $10,010 20,570 21,930 41,700 3,000 2,080 1,010 (105,270) (88,250) 522,870 401,710 (130,840 (111,260) 49,560 $905,540 $870,915 44,830 Total assets Accounts payable Income taxes payable Salaries and wages payable Short-term notes payable Long-term notes payable Bonds payable Premium on bonds payable Common stock Paid-in capital in excess of par-common stock Retained earnings $21,890 $32,290 4,020 2,970 9,990 70,620 400,040 400,040 22,175 238,100 221,930 17,560 89,320 $905,540 $870,915 5,030 4,970 9,990 60,590 17,390 25,040 122,500 Total liabilities and stockholders' equity INDIGO COMPANY INCOME STATEMENT AND DIVIDEND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2017 Sales revenue $1,162,530 743,150 419,380 Cost of goods sold FOR THE YEAR ENDED DECEMBER 31, 2017 Sales erenue 1,102, 53U Cost of goods suld 19,30 Gross margin Upersing expees Selling expenses Adminitrative expenses Depreciaticn Amcrtization expensc Total operaing experses 155,410 277,550 141,830 Gain cn sale of shert-term inestment Dividend revenue [nterest experise 7,970 4,020 2,330 3,240) 104,500 34,020 53,570 Nct inccme Dhidands to common stcckholdar To retained arnings Precere either a state ne t of cash flo s 0 Indgo do panv US the direct method go -sign eg. -15,000 or in parenthesis eg. (i5,oD).) mpan ed by a reco cliation schedule. Assume the s ort-term investments are de t sec it es classi ied as available for sale w amountsthe investing on g sectio s that decreese o sh no v w th INDIGO COMPANY Statement of Cash Flows Direct Cash receipts: Cash payments (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) Reconciliation Schedule Reconciliation of Net Income to Adjustments to reconcile net income to

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