Assignment
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AZTEC TRUCKING CORP
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Comparative Balance Sheet
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December 31, 2016 and 2015
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ASSETS
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2016
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2015
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Current assets
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Cash
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$ 505,091
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$ 40,130
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Accounts receivable
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375,000
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445,000
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Inventories
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150,000
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227,870
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Prepaid expenses
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35,000
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25,125
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Total current assets
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$1,065,091
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$ 738,125
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Property, plant & equip.
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Land
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$ 400,000
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$ 400,000
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Equipment
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140,000
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215,000
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$ 540,000
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$ 615,000
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Less: Accumulated depreciation
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(80,000)
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(85,000)
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Total property, plant & equipment
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$ 460,000
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$ 530,000
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Total assets
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$1,525,091
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$1,268,125
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LIABILITIES
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Current liabilities
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Accounts payable
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$ 39,373
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$ 32,995
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Dividends payable
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$ 30,000
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$ 20,000
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Unearned revenue
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$ 58,700
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$ 25,130
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Total current liabilities
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$ 128,073
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$ 78,125
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Long-term liabilities
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Notes payable, Net
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100,000
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400,000
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Bonds payable, Net
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111,518
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-
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Total liabilities
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$ 339,591
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$ 478,125
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STOCKHOLDERS' EQUITY
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Common Stock and APIC
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810,000
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610,000
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Retained earnings
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375,500
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180,000
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Total stockholders' equity
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$1,185,500
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$ 790,000
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Total Liabilities and equity
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$1,525,091
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$1,268,125
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Additional information about transactions and events occurring in 2016 follows:
1. Dividends of $50,000 were declared during the year.
2. On January 1, 2016, the company issued 10 year, $100,000, 12% bonds at a market rate of 10%. Interest on the bonds is paid annually on December 31.
3. On June 30, 2016, the company sold equipment for a $10,000 gain. The equipment was purchased on June 30, 2014 for $75,000. It was being depreciated using straight-line with no salvage value over a 10 year useful life.
4. The notes payable on the books at January 1, 2016 are interest-bearing. A portion of these notes payable were paid down during the year. Interest expense on all notes payable totaled $8,000 for the year.
5. Cash receipts of $40,000 for shipments that were not made until 2017 were mistakenly recorded as revenue and included in net income. This error has not been corrected in the balance sheet above, but it must be corrected to produce a statement of cash flows.
6. Net Income for the period totaled $245,500. Cost of Goods Sold for the period totaled $40,800.
(if you use your financial calculator, it becomes difficult to give partial credit, so be sure to indicate what you entered into your calculator to make your calculations)
Using the financial statement data, prepare a complete statement of cash flows, including any required supplemental disclosures, using the INDIRECT method.