P12-5 (Static) (Supplement B) Preparing a Statement of Cash Flows with Gain on Sale of Equipment...

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P12-5 (Static) (Supplement B) Preparing a Statement of Cash Flows with Gain on Sale of Equipment (Indirect Method) LO12-2, 12-4, 12-6 XS Supply Company is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized below: Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings Income statement for current year Sales Gain on sale of equipment Cost of goods sold Other expenses Net income Additional data. Current Year Prior Year $ 34,000 $ 29,000 35,000 28,000 41,000 38,000 121,000 100,000 (30,000) (25,000) $201,000 $170,000 $ 36,000 $27,000 1,200 1,400 38,000 44,000 88,600 72,600 37,200 25,000 $201,000 $170,000 $ 120,000 1,000 70,000 38,800 $ 12,200 a. Bought equipment for cash, $31,000. Sold equipment with original cost of $10,000, accumulated depreciation of $7,000, for $4,000 cash. b. Paid $6,000 on the long-term note payable. c. Issued new shares of stock for $16,000 cash. d. No dividends were declared or paid. e. Other expenses included depreciation, $12,000; wages, $13,000; taxes, $6,000; and other, $7,800. f. Accounts payable includes only Inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, assume that these expenses were fully paid in cash. Required: 1. Prepare the statement of cash flows for the year ended December 31, current year, using the indirect method. Note: List cash outflows as negative amounts. Required: 1. Prepare the statement of cash flows for the year ended December 31, current year, using the indirect method. Note: List cash outflows as negative amounts. Cash flows from operating activities: XS SUPPLY COMPANY Statement of Cash Flows For the Year Ended December 31, Current Year Adjustments to reconcile net income to net cash provided by operating activities: Cash flows from investing activities: Cash flows from financing activities: $ 0 0 0 P12-5 (Static) (Supplement B) Preparing a Statement of Cash Flows with Gain on Sale of Equipment (Indirect Method) LO12-2, 12-4, 12-6 XS Supply Company is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized below: Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings Income statement for current year Sales Gain on sale of equipment Cost of goods sold Other expenses Net income Additional data. Current Year Prior Year $ 34,000 $ 29,000 35,000 28,000 41,000 38,000 121,000 100,000 (30,000) (25,000) $201,000 $170,000 $ 36,000 $27,000 1,200 1,400 38,000 44,000 88,600 72,600 37,200 25,000 $201,000 $170,000 $ 120,000 1,000 70,000 38,800 $ 12,200 a. Bought equipment for cash, $31,000. Sold equipment with original cost of $10,000, accumulated depreciation of $7,000, for $4,000 cash. b. Paid $6,000 on the long-term note payable. c. Issued new shares of stock for $16,000 cash. d. No dividends were declared or paid. e. Other expenses included depreciation, $12,000; wages, $13,000; taxes, $6,000; and other, $7,800. f. Accounts payable includes only Inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, assume that these expenses were fully paid in cash. Required: 1. Prepare the statement of cash flows for the year ended December 31, current year, using the indirect method. Note: List cash outflows as negative amounts. Required: 1. Prepare the statement of cash flows for the year ended December 31, current year, using the indirect method. Note: List cash outflows as negative amounts. Cash flows from operating activities: XS SUPPLY COMPANY Statement of Cash Flows For the Year Ended December 31, Current Year Adjustments to reconcile net income to net cash provided by operating activities: Cash flows from investing activities: Cash flows from financing activities: $ 0 0 0