70.2K

Verified Solution

Link Copied!

Requirement:

Prepare the statement of cash flows of Susan Saboda Design Studio, Inc., for the year ended June 30, 2012, using the indirect method to report operating activities. All current accounts except Notes payable, short term result from operating transactions.

P12-66A (Learning Objectives 2, 3, 4: Prepare the statement of cash flows indirect method) comparative balance sheets of Susan Saboda Design Studio, Inc., at June 30, 2012 and 2011, and transaction data for fiscal 2012, are as follows: Susan Saboda Design Studio Comparative Balance Sheets June 30, 2012 2011 Increase (Decrease) Current assets: Cash Accounts receivable Inventories Prepaid expenses Long-term investment Equipment, net Land $ 28,600 59,000 78,400 1,500 20,400 74,700 49,700 $312,300 $ 12,200 22,100 40,400 2,300 2,700 73,800 92,800 $246,300 $ 16,400 36,900 38,000 (800) 17,700 900 (43,100) $ 66,000 Current liabilities: Notes paya ble, short-term Accounts payable Income tax payable Accrued liabilities Interest payable Salary payable Long-term note payable Common stock Retained earnings $ 13,800 46,400 13,400 66,500 3,500 800 47.100 69,300 51,500 $312,300 S 18,700 40,400 15,100 3,100 2,300 2,900 94.000 51,200 18.600 $ (4,900) 6,000 (1,700) 63,400 1,200 (2,100) (46,900) 18,100 32,900 $246,300 $ 66,000 Transaction data for the year endedJune 30, 2012, follows: a. Net income, $70,600 b. Depreciation expense on equipment, $13,300 c. Purchased long-term investment, $17,700 d. Sold land for $36,400, including $6,700 loss e. Acquired equipment by issuing long-term note payable, $14,200 f. Paid long-term note payable, $61,100 g. Received cash for issuance of common stock, $13,200 h. Paid cash dividends, $37,700 i. Paid short-term note payable by issuing common stock, $4,900

Answer & Explanation Solved by verified expert

See Answer