Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and...
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Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows. Comprehensive The following are Farrell Corporation's balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31, 2016: Balance Sheets December 31 Increase 2016 2015 (Decrease) Assets Cash $ 225,000 295,000 549,000 73,000 350,000 624,000 (139,000) 16,000 $1,993,000 $ 180,000 305,000 431,000 60,000 200,000 606,000 (107,000) 20,000 $1,695,000 $ 45,000 (10,000) 118,000 13,000 150,000 18,000 (32,000) (4,000) $298,000 Accounts receivable, net Inventories Investment in Hall Inc. at equity Land Plant and equipment Less: Accumulated depreciation Patent Total Assets Liabilities and Shareholders' Equity Accounts payable and accrued expenses Note payable, long-term Bonds payable Deferred taxes payable Common stock, $io par Additional paid-in capital Retained earnings Treasury stock, at cost Total Liabilities and Shareholders' Equity $ 604,000 150,000 160,000 41,000 410,000 196,000 432,000 $ 563,000 210,000 30,000 400,000 175,000 334,000 (17,000) $1,695,000 $ 41,000 150,000 (50,000) 11,000 10,000 21,000 98,000 17,000 $298,000 $1,993,000 Statement of Income and Retained Earnings For the Year Ended December 31, 2016 Net sales Operating expenses: Cost of sales Selling and administrative expenses Depreciation $1,950,000 $1,150,000 505,000 53,000 $1,708,000 $ 242,000 Operating income Other (income) expense: Interest expense Equity in net income of Hall Inc. Loss on sale of equipment Amortization of patent $ 15,000 (13,000) 5,000 4,000 $ 11,000 231,000 Income before income taxes Income taxes: Current Deferred Provision for income taxes Net income Retained earnings, January 1, 2016 $ 79,000 11,000 90,000 $ 141,000 334,000 $ 475,000 43,000 $ 432,000 Cash dividends, paid August 13, 2016 Retained earnings, Docember 31, 2016 Additional information: On January 2, 2016, Farrell sold equipment costing $45,000, with a book value of $24,000, for $19,000 cash. b. On April 2, 2016, Farrell issued 1,000 shares of common stock for $23,000 cash. On May 14, 2016, Farrell sold all of its treasury stock for $25,000 cash. d. On June 1, 2016, Farrell paid S50,000 to retire bonds with a face value (and book value) of $50,000. e. On July 2, 2016, Farrell purchased equipment for $63,000 cash. f. On December 31, 2016, land with a fair market value of $150,000 was purchased through the issuance of a long term note in the amount of $150,000. The note bears interest at the rate of 15% and is due on December 31, 2018. g. Deferred taxes payable represent temporary differences relating to the use of accelerated depreciation methods for income tax reporting and the straight-line method for financial statement reporting. a. c. Required: 1. Prepare a spreadsheet to support a statement of cash flows for Farrell for the year ended December 31, 2016, based on the preceding information. 2. Prepare the statement of cash flows.
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Related Book For
Intermediate Accounting Reporting and Analysis
ISBN: 978-1285453828
2nd edition
Authors: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Posted Date:
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The following arc Farrell Corporations balance sheets as of December 31, 2016, and 2015, and the statement of income and retained earnings for the year ended December 31,2016: Additional information:...
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The condensed balance sheets as of December 31 for Rice and Associated and Rachel Excavation are as follows: As of December 31, the market values of Rachel's inventories and fixed assets were $70,000...
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A parallel-plate capacitor with circular plates of radius 0.10 m is being discharged. A circular loop of radius 0.20 m is concentric with the capacitor and halfway between the plates. The...
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To measure the effect on coordination associated with mild intoxication, thirteen subjects were each given 15.7mL of ethyl alcohol per square meter of body surface area and asked to write a certain...
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Accounting for earnings per share has certain weaknesses that our analysis must consider for interpreting EPS data. Identify and discuss at least two weaknesses.
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Suppose you want to organize books onto shelves, and you want the shelves to hold the same number of books. Each shelf will only contain one genre of book. You have 24 sci-fi, 42 fantasy, and 30...
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The partnership of Robo and Swing, CPAs, reported revenues of $215,000 and expenses of $80,000 on their year-end work sheet. Their capital balances as of January 1, 20--, were $55,000 for I. Robo and...
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Seattle Health Plans currently uses zero-debt financing. Itsoperating income (earnings before interest and taxes, or EBIT) is$1 million, and it pays taxes at a 40 percent rate. It has $5million in 2...
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Explain why expected net income is also called "accretion of discount."
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A primary objective of international financial accounting standards is to equip a company with reporting a consistent, comparable, and fair view of its operations. However, no two companies (as...
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Another pertinent research subject within the sphere of political economic policies is the challenge of addressing income inequality. This matter holds significance due to the demonstrated adverse...
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Explain what an externality is, and describe one example of an externality. (2 marks) Explain how Interface Floor (Ray Anderson's company) increased profitability by reducing their ecological...
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Choose a recent period of economic fluctuation (either a recession or expansion). Use the aggregate supply and aggregate demand framework to discuss evidence you saw in the economy to determine if...
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(92) 9. Simplify: 3 xy 2 x4y (y 6)3
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The high rates of Huntington's chorea in populations near Lake Maracaibo in Venezuela is an example of which type of genetic drift?
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1. Why does citizen mobility increase the desirability of decentralized decision-making in relation to efficiency? What does Tiebout mean by "voting on your feet?" How does the Tiebout model explain...
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Walker, Inc., is an all-equity firm. The cost of the company's equity is currently 11.4 percent and the risk-free.rate is 3.3 percent. The company is currently considering a project that will cost...
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Nickle Company purchased three identical assets for $ 17,000 on January 2, 2016. Each asset has an expected residual value of $ 1,000. The depreciation expense for 2016 and 2017 is shown below for...
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What are closing entries, and what is their purpose?
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Multiple choice questions 1. Sienna Company has inventory with a selling price of $ 100, packaging costs of $ 5, and transportation costs of $ 10. Siennas normal profit margin is $ 20. However, due...
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What are pro formas?
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The following information is taken from the accounting records of Donald Company: Average receivables \(\$ 700,000\) Cost of goods sold \(.2,900,000\) Sales \(8,000,000\) Average inventory...
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How does a forensic accountant analyze inventories and receivables?
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