Selected financial statements for Ralston Company, a sole proprietorship, are as follows:

Additional Information:
a. During 2014, equipment having accumulated depreciation of $4,500 was sold for a $3,000 gain.
b. A $3,750 lease payment was made in 2014, reducing the lease liability by $3,000.
c. 2014 depreciation expense: on leased property, $3,000; on equipment, $8,250.
d. Net income for 2014, $14,250.

Required:
Using the provided data, prepare Ralston€™s December 31, 2014, balancesheet.

Transcribed Image Text:

Balance Sheet as of December 31,2013 Assets: Equipment Accumulated depreciation: equipment Leased property 30,000 36,000 (11,250) 8,000 72,750 Total Liabilities and owner's equity: Lease liability Ralston, capital 18,000 54,750 72,750 tatement of Cash Flows for the Year Ended December 31, 2014 Cash flows from operating activities Collections fron customers Payments for salaries Payments for other expenses 37,500 (8,250) (6,750) Net cash provided by operating activities Cash flows from investing activities Sale of equipment Purchase of land Purchase of investments 5,250 (13,500) Net cash used by investing activities (30,750) Cash flows from financing activities Payment on lease liability Issue of long-term notes Owner withdrawals (3,000) (12,000) Net cash from financing activities Net decrease in cash $ (8,250)