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Golden Corp., a merchandiser, recently completed its 2013 operations. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company's balance sheets and income statement follow.

hiododf CORPORATION
Comparative Balance Sheets
December 31, 2013 and 2012
2013 2012
Assets
Cash $ 163,000 $ 135,000
Accounts receivable 83,000 73,000
Merchandise inventory 630,000 525,000
Equipment 340,000 286,000
Accum. depreciation-Equipment (157,000) (105,000)

Total assets $ 1,059,000 $ 914,000

Liabilities and Equity
Accounts payable $ 158,000 $ 128,000
Income taxes payable 28,000 25,000
Common stock, $2 par value 592,000 568,000
Paid-in capital in excess of par value, common stock 193,000 157,000
Retained earnings 88,000 36,000

Total liabilities and equity $ 1,059,000 $ 914,000


GOLDEN CORPORATION
Income Statement
For Year Ended December 31, 2013
Sales $ 1,797,000
Cost of goods sold 1,086,000

Gross profit 711,000
Operating expenses
Depreciation expense $ 52,000
Other expenses 499,000 551,000

Income before taxes 160,000
Income taxes expense 23,000

Net income $ 137,000


Additional Information on Year 2013 Transactions

a. Purchased equipment for $54,000 cash.

b. Issued 12,000 shares of common stock for $5 cash per share.

c. Declared and paid $85,000 in cash dividends.

Required:

Prepare a complete statement of cash flows; report its cash inflows and cash outflows from operating activities according to the indirect method.

 

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M946872

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