ABC Manufacturing Inc. Income Statement Year Ended December 31, 20X4 Sale $ 200,000 Cost of goods sold
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Question:
ABC Manufacturing Inc. | ||||
Income Statement | ||||
Year Ended December 31, 20X4 | ||||
Sale | $ | 200,000 | ||
Cost of goods sold | $ | 120,000 | ||
Gross Profit | $ | 80,000 | ||
Operating Expenses | $ | 40,000 | ||
Loss on Sale of equipment | $ | 2,000 | $ | 42,000 |
Profit from Operations | $ | 38,000 | ||
Other expenses | ||||
Interest Expense | $ | 2,000 | ||
Profit before Income Tax | $ | 36,000 | ||
Income Tax Expense | $ | 8,000 | ||
Profit | $ | 28,000 | ||
ABC Manufacturing Inc. comparative balance sheet at December 31
20X4 | 20X3 | |||||
Cash | $ | 4,500 | $ | 4,300 | ||
Accounts Receivable | $ | 72,000 | $ | 6,500 | ||
Inventory | $ | 110,000 | $ | 140,000 | ||
Prepaid Expenses | $ | 1,550 | $ | 1,020 | ||
Equipment | $ | 98,000 | $ | 100,000 | ||
Accumulated Depreciation - equipment | $ | (50,000 | ) | $ | (42,000 | ) |
Total Assets | $ | 236,050 | $ | 209,820 | ||
Account Payable | $ | 15,330 | $ | 9,900 | ||
Interest Payable | $ | 510 | $ | 10 | ||
Income taxes payable | $ | 10,800 | $ | 9,500 | ||
Dividends Payable | $ | 1,800 | $ | 3,800 | ||
Long-term Notes Payable | $ | 50,000 | $ | 65,000 | ||
Common shares | $ | 130,000 | $ | 120,000 | ||
Retained Earnings | $ | 27,610 | $ | 1,610 | ||
Total Liabilities & Shareholders' Equity | $ | 236,050 | $ | 209,820 | ||
Additional Information:
- Operating expenses include depreciation expense of $10,000
- Accounts Payable related to the purchase of inventory
- Equipment that cost $8,000 was sold at a loss of $2,000
- New equipment was purchased during the year for $6,000
- Dividends declared and paid in 20X4 totaled $2,000
- Common shares were sold for $10,000 cash
- Interest payable in 20X4 was $500 greater than interest payable in 20X3
By how much has the changes in Working Capital generated or (used) cash when the indirect method to prepare cash flow statements is use? Assume the company uses ASPE.
Posted Date: