Problem 12-10A
Condensed financial data of Odgers Inc. follow.
|
ODGERS INC.
Comparative Balance Sheets
December 31
|
|
Assets
|
2014
|
2013
|
|
Cash
|
$150,288
|
$90,024
|
|
Accounts receivable
|
163,308
|
70,680
|
|
Inventory
|
209,250
|
191,301
|
|
Prepaid expenses
|
52,824
|
48,360
|
|
Long-term investments
|
256,680
|
202,740
|
|
Plant assets
|
530,100
|
451,050
|
|
Accumulated depreciation
|
(93,000
|
(96,720
|
|
Total
|
$1,269,450
|
$957,435
|
| |
|
|
|
Liabilities and Stockholders' Equity
|
|
|
|
Accounts payable
|
$189,720
|
$125,178
|
|
Accrued expenses payable
|
30,690
|
39,060
|
|
Bonds payable
|
204,600
|
271,560
|
|
Common stock
|
409,200
|
325,500
|
|
Retained earnings
|
435,240
|
196,137
|
|
Total
|
$1,269,450
|
$957,435
|
|
ODGERS INC.
Income Statement Data
For the Year Ended December 31, 2014
|
|
Sales revenue
|
|
$722,536
|
|
Less:
|
|
|
|
Cost of goods sold
|
$251,956
|
|
|
Operating expenses, excluding depreciation
|
23,083
|
|
|
Depreciation expense
|
86,490
|
|
|
Income taxes
|
50,741
|
|
|
Interest expense
|
8,798
|
|
|
Loss on disposal of plant assets
|
13,950
|
435,018
|
|
Net income
|
|
$287,518
|
Additional information:
1. New plant assets costing $186,000 were purchased for cash during the year.
2. Old plant assets having an original cost of $106,950 and accumulated depreciation of $90,210 were sold for $2,790 cash.
3. Bonds payable matured and were paid off at face value for cash.
4. A cash dividend of $48,415 was declared and paid during the year.
Further analysis reveals that accounts payable pertain to merchandise creditors.
Prepare a statement of cash flows for Odgers Inc. using the direct method