In: Accounting
Presented below are the 2020 Income Statement and Balance Sheet for Riggins Online Store. Prepare a Cash Flow Statement as of December 31, 2020.
Additional Information for the 2020 fiscal year includes: 1) Cash dividends of $1,000 were declared and paid. 2) Equipment with a cost of $1,500 and accumulated depreciation of $1,000 was sold for $500.
Riggins Online Store |
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Income Statement |
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For the Year Ended December 31, 2020 |
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Sales Revenue |
$ 14,250 |
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Service Revenue |
3,400 |
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Total Revenue |
$ 17,650 |
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Operating Expenses: |
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Cost of Goods Sold |
5,600 |
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Depreciation |
1,600 |
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Selling |
2,400 |
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General and administrative |
1,500 |
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Total Operating Expenses |
11,100 |
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Operating Income |
6,550 |
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Interest Expense |
200 |
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Income Before Income Taxes |
6,350 |
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Income Tax Expense |
2,500 |
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Net Income |
$ 3,850 |
Riggins Online Store |
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Balance Sheet |
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As of December 31, 2019 and 2020 |
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2020 |
2019 |
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Assets |
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Cash |
$ 7,350 |
$ 2,200 |
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Accounts Receivable |
2,500 |
2,200 |
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Inventory |
4,000 |
3,000 |
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Prepaid Rent |
150 |
300 |
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Plant and Equipment |
14,500 |
12,000 |
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Less: Accumulated Deprecation |
(5,100) |
(4,500) |
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Total Assets |
$ 23,400 |
$ 15,200 |
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Liabilities and Shareholder's Equity |
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Accounts Payable |
$ 1,400 |
$ 1,100 |
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Interest Payable |
100 |
- |
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Deferred Service Revenue |
800 |
600 |
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Income Taxes Payable |
550 |
800 |
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Note Payable, due 12,31, 2023 |
5,000 |
- |
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Common Stock |
10,000 |
10,000 |
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Retained Earnings |
5,550 |
2,700 |
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Total Liabilities and Shareholder's Equity |
$ 23,400 |
$ 15,200 |
Riggin Online Store | |||
Cash Flow Statement | |||
Cash flow from operating activities | |||
Net income | $3,850.00 | ||
Adjustment reconcile net income | |||
Depreciation | $1,600.00 | ||
Increase account receivable | -$300.00 | ||
Increase invenry | -$1,000.00 | ||
Deccrease in prepaid Rent | $150.00 | ||
Increase account payable | $300.00 | ||
Increase Interest Payable | $100.00 | ||
Increase Deferred Servcie Revenue | $200.00 | ||
Deccrease Income Tax Payable | -$250.00 | $800.00 | |
Net cash flow from operating activities (a) | $4,650.00 | ||
Cash flow from investing activities | |||
Sale of Equipment | $500.00 | ||
Purchase of Equipment (14500+1500-12000) | -$4,000.00 | ||
Net cash flow from investing activities (b) | -$3,500.00 | ||
Cash flow from financing activities | |||
Dividend paid (2700+3850-5550) | -$1,000.00 | ||
Proceed from Note Payable | $5,000.00 | ||
Net cash flow from financing activities © | $4,000.00 | ||
Net cash flow (a+b+c) | $5,150.00 | ||
Beginning cash | $2,200.00 | ||
Ending cash | $7,350.00 |