60.1K

Verified Solution

Link Copied!

The comparative balance sheet of Harris Industries Inc. at December 31, 20Y4 and 20Y3, is as follows:

An examination of the income statement and the accounting records revealed the following additional information applicable to 20Y4:

Net income, $524,580.

Depreciation expense reported on the income statement: buildings, $51,660; machinery and equipment, $22,680.

Patent amortization reported on the income statement, $5,040.

A building was constructed for $579,600.

A mortgage note for $224,000 was issued for cash.

30,000 shares of common stock were issued at $13 in exchange for the bonds payable.

Cash dividends declared, $131,040.

Instructions

Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities.

Dec. 31, 20Y4 Dec. 31, 20Y3 Assets $ 360,920 Cash $443,240 Accounts receivable (net) 665,280 592,200 Inventories 887,880 1,022,560 Prepaid expenses 25,200 31,640 Land 302,400 302,400 Buildings Accumulated depreciation-buildings Machinery and equipment.... Accumulated depreciation-machinery and equipment... 1,713,600 1,134,000 (466,200) (414,540) 781,200 781,200 (214,200) (191,520) Patents 106,960 112,000 Total assets $4,251,800 $3,724,420 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) Dividends payable.... Salaries payable. .. $927,080 $837,480 32,760 25,200 78,960 87,080 Mortgage note payable, due in 10 years. Bonds payable... Common stock, $5 par. . 224,000 0 C 390,000 200,400 50,400 Paid-in capital: Excess of issue price over par-common stock... Retained earnings.. Total liabilities and stockholders' equity... 366,000 126,000 2,512,200 2,118,660 $3,724,420 $4,251,800

Answer & Explanation Solved by verified expert

See Answer