Question

Kay Wing, Inc., prepared the following balance sheet at December 31, 2013.
Cash ............... $ 65,000
Accounts receivable ........... 37,000
Inventory .............. 70,000
Long-term investments ........... 20,000
Land ................ 39,000
Plant and equipment (net) ....... 109,000
Total assets ............. $340,000

Accounts payable ............ $ 33,000
Taxes payable .............. 4,000
Bonds payable .............. 80,000
Capital stock ............. 90,000
Retained earnings ............ 133,000
Total liabilities and stockholders’ equity . $340,000

The following occurred during 2014.
1. $15,000 in cash and a $35,000 note payable were exchanged for land valued at $50,000.
2. Bonds payable (maturing in 2018) in the amount of $30,000 were retired by paying $28,000 cash.
3. Capital stock in the amount of $40,000 was issued at par value.
4. The company sold surplus equipment for $10,000. The equipment had a book value of $14,000 at the time of the sale.
5. Net income was $35,500.
6. Cash dividends of $5,000 were paid to the stockholders.
7. 100 shares of stock (considered short-term investments) were purchased for $8,300.
8. A new building was acquired through the issuance of $75,000 in bonds.
9. $12,000 of depreciation was recorded on the plant and equipment.
10. At December 31, 2014, Cash was $93,200, Accounts receivable had a balance of $41,500, Inventory had increased to $73,000, and Accounts payable had fallen to $25,500. Long-term investments and Taxes payable were unchanged from 2013.

Required:
1. Prepare a statement of cash flows for 2014.
2. Prepare the December 31, 2014, balance sheet for Kay Wing, Inc.



$1.99
Sales0
Views111
Comments0
  • CreatedSeptember 10, 2014
  • Files Included
Post your question
5000