The comparative balance sheets and an income statement for Wang Beauty Products, Inc. are shown next: Income
Question:
The comparative balance sheets and an income statement for Wang Beauty Products, Inc. are shown next:
Income Statement For the Year Ended December 31, Year 2
Sales ................................................................... $1,500,000
Cost of goods sold ............................................... (797,200)
Gross profit ............................................................702,800
Operating expenses
Depreciation expense .............................................(22,800)
Rent expense ..........................................................(24,000)
Salaries expense .....................................................(256,000)
Other operating expenses ........................................(258,000)
Net income ................................................................$ 142,000
Other Information
1. Purchased land for $112,000.
2. Purchased new equipment for $100,000.
3. Sold old equipment that cost $132,000 with accumulated depreciation of $112,000 for $20,000 cash.
4. Issued common stock for $50,000.
Required
Prepare the statement of cash flows for Year 2 using the indirect method.
Step by Step Answer:
Introductory Financial Accounting for Business
ISBN: 978-1260299441
1st edition
Authors: Thomas Edmonds, Christopher Edmonds