Hartman, Inc. has prepared the following comparative balance sheets for 2017 and 2018: 2018 2017 Cash $
Question:
Hartman, Inc. has prepared the following comparative balance sheets for 2017 and 2018:
2018 2017
Cash $ 282,000 $ 153,000
Accounts receivable 139,000 117,000
Inventory 150,000 180,000
Prepaid expenses 18,000 27,000
Plant assets 1,295,000 1,050,000
Accumulated depreciation (450,000) (375,000)
Patent 153,000 174,000
$1,587,000 $1,326,000
Accounts payable $ 153,000 $ 168,000
Accrued liabilities 60,000 42,000
Mortgage payable — 450,000
Preferred stock 525,000 —
Additional paid-in capital—preferred 120,000 —
Common stock 600,000 600,000
Retained earnings 129,000 66,000
$1,587,000 $1,326,000
1. The Accumulated Depreciation account has been credited only for the depreciation expense for the period.
2. The Retained Earnings account has been charged for dividends of $177,600 and credited for the net income for the year.
The income statement for 2018 is as follows:
Sales revenue $1,980,000
Cost of sales 1,089,000
Gross profit 891,000
Operating expenses 690,000
Net income $ 201,000
Instructions
(a) From the information above, prepare a statement of cash flows (indirect method) for Hartman, Inc. for the year ended December 31, 2018.
(b) From the information above, prepare a schedule of cash provided by operating activities using the direct method.
Financial Reporting and Analysis
ISBN: 978-1259722653
7th edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer