In: Accounting
Sheffield Inc., a greeting card company, had the following
statements prepared as of December 31, 2020.
SHEFFIELD INC. |
||||||
---|---|---|---|---|---|---|
12/31/20 |
12/31/19 |
|||||
Cash |
$5,900 |
$6,900 |
||||
Accounts receivable |
61,400 |
50,800 |
||||
Short-term debt investments (available-for-sale) |
35,000 |
17,800 |
||||
Inventory |
40,000 |
59,400 |
||||
Prepaid rent |
5,000 |
3,900 |
||||
Equipment |
155,200 |
129,000 |
||||
Accumulated depreciation—equipment |
(35,000 |
) |
(25,000 |
) |
||
Copyrights |
45,600 |
49,900 |
||||
Total assets |
$313,100 |
$292,700 |
||||
Accounts payable |
$46,300 |
$39,800 |
||||
Income taxes payable |
3,900 |
6,100 |
||||
Salaries and wages payable |
7,900 |
3,900 |
||||
Short-term loans payable |
8,000 |
10,100 |
||||
Long-term loans payable |
60,100 |
68,400 |
||||
Common stock, $10 par |
100,000 |
100,000 |
||||
Contributed capital, common stock |
30,000 |
30,000 |
||||
Retained earnings |
56,900 |
34,400 |
||||
Total liabilities & stockholders’ equity |
$313,100 |
$292,700 |
SHEFFIELD INC. |
||||
---|---|---|---|---|
Sales revenue |
$338,600 |
|||
Cost of goods sold |
174,500 |
|||
Gross profit |
164,100 |
|||
Operating expenses |
119,100 |
|||
Operating income |
45,000 |
|||
Interest expense |
$11,400 |
|||
Gain on sale of equipment |
1,900 |
9,500 |
||
Income before tax |
35,500 |
|||
Income tax expense |
7,100 |
|||
Net income |
$28,400 |
Additional information:
1. | Dividends in the amount of $5,900 were declared and paid during 2020. | |
2. | Depreciation expense and amortization expense are included in operating expenses. | |
3. | No unrealized gains or losses have occurred on the investments during the year. | |
4. | Equipment that had a cost of $20,100 and was 70% depreciated was sold during 2020. |
Prepare a statement of cash flows using the indirect method.
(Show amounts that decrease cash flow with either a -
sign e.g. -15,000 or in parenthesis e.g.
(15,000).)
SHEFFIELD INC. |
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