Use the following data for Window Rock Company to prepare a statement of cash flows using the
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Question:
Use the following data for Window Rock Company to prepare a statement of cash flows using the indirect method for the year ended June 30, 20x6.
Window Rock Company | |||||
Income Statement | |||||
For the Year Ended June 30, 20x6 | |||||
Sales | $1,400,000 | ||||
Less expenses | |||||
Cost of goods sold | $800,000 | ||||
Depreciation expense | 80,000 | ||||
Administrative expenses | 208,000 | ||||
Selling expenses | 140,000 | ||||
Loss on sale of investment | 2,000 | 1,230,000 | |||
Income before income taxes | 170,000 | ||||
Income taxes expense | 40,000 | ||||
Net income | $ 130,000 | ||||
Window Rock Company | ||
Comparative Balance Sheets | ||
Assets | 20x6 | 20x5 |
Cash | $ 18,000 | $ 60,000 |
Accounts receivable (net) | 140,000 | 110,000 |
Inventory | 160,000 | 200,000 |
Prepaid insurance | 12,000 | 10,000 |
Long-term investments | 80,000 | 100,000 |
Plant and equipment | 320,000 | 160,000 |
Accumulated depreciation | (80,000) | (48,000) |
Total assets | $650,000 | $592,000 |
Liabilities | ||
Accounts payable | $ 8,000 | $ 24,000 |
Wages payable | 880 | 1,040 |
Income taxes payable | 3,120 | 2,960 |
Notes payable | 80,000 | 48,000 |
Total liabilities | $ 92,000 | $ 76,000 |
Stockholders' Equity | ||
Common stock | $ 232,000 | $260,000 |
Retained earnings | 326,000 | 256,000 |
Total stockholders' equity | $558,000 | $516,000 |
Total liabilities and stockholders' equity | $650,000 | $592,000 |
Additional information:
A plant asset costing $80,000 was sold for its book value of $32,000. | |
A long-term investment was sold for $18,000. | |
The outstanding notes are long-term. A $32,000 note was issued during 20x6. |
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