Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an...

    

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Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note. (List cash outflows and any decrease in cash as negative amounts.) Net sales Expenses: Cost of goods sold Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense Total expenses Net income VIDEO PHONES, INC. Income Statement For the Year Ended December 31, 2018 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investments Land Equipment Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities: Notes payable Stockholders' equity: Common stock Retained earnings VIDEO PHONES, INC. Balance Sheet December 31 $ 2,050,000 878,000 29,000 8,200 16,000 50,000 Total liabilities and stockholders' equity 69 $ 69 $ 3,136,000 3,031,200 104,800 2018 179,720 $ 83,200 105,000 12,480 107,000 212,000 274,000 (71,400) 902,000 $ 67,800 $ 6,200 15,200 289,000 320,000 203,800 902,000 $ 2017 160,760 62,000 137,000 6,240 0 244,000 212,000 (42,400) 779,600 83,000 10,400 14,200 227,000 320,000 125,000 779,600 Additional Information for 2018: 1. Purchase investment in bonds for $107,000. 2. Sell land costing $32,000 for only $23,800, resulting in a $8,200 loss on sale of land. 3. Purchase $62,000 in equipment by borrowing $62,000 with note payable due in three years. No cash is exchanged in the transaction. 4. Declare and pay a cash dividend of $26,000. VIDEO PHONES, INC. Statement of Cash Flows For the Year Ended December 31, 2018 Cash Flows from Operating Activities: Net income Adjustments to reconcile net income to net cash flows from operating activities: Increase in accounts receivable Decrease in inventory Increase in prepaid rent Decrease in accounts payable Net cash flows from operating activities Cash Flows from Investing Activities: Net cash flows from investing activities Cash Flows from Financing Activities: Net cash flows from financing activities Cash at the beginning of the period Cash at the end of the period Note: Noncash Activities $ $ 0 0 D 0 Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note. (List cash outflows and any decrease in cash as negative amounts.) Net sales Expenses: Cost of goods sold Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense Total expenses Net income VIDEO PHONES, INC. Income Statement For the Year Ended December 31, 2018 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investments Land Equipment Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities: Notes payable Stockholders' equity: Common stock Retained earnings VIDEO PHONES, INC. Balance Sheet December 31 $ 2,050,000 878,000 29,000 8,200 16,000 50,000 Total liabilities and stockholders' equity 69 $ 69 $ 3,136,000 3,031,200 104,800 2018 179,720 $ 83,200 105,000 12,480 107,000 212,000 274,000 (71,400) 902,000 $ 67,800 $ 6,200 15,200 289,000 320,000 203,800 902,000 $ 2017 160,760 62,000 137,000 6,240 0 244,000 212,000 (42,400) 779,600 83,000 10,400 14,200 227,000 320,000 125,000 779,600 Additional Information for 2018: 1. Purchase investment in bonds for $107,000. 2. Sell land costing $32,000 for only $23,800, resulting in a $8,200 loss on sale of land. 3. Purchase $62,000 in equipment by borrowing $62,000 with note payable due in three years. No cash is exchanged in the transaction. 4. Declare and pay a cash dividend of $26,000. VIDEO PHONES, INC. Statement of Cash Flows For the Year Ended December 31, 2018 Cash Flows from Operating Activities: Net income Adjustments to reconcile net income to net cash flows from operating activities: Increase in accounts receivable Decrease in inventory Increase in prepaid rent Decrease in accounts payable Net cash flows from operating activities Cash Flows from Investing Activities: Net cash flows from investing activities Cash Flows from Financing Activities: Net cash flows from financing activities Cash at the beginning of the period Cash at the end of the period Note: Noncash Activities $ $ 0 0 D 0

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