REQUIRED:

(1) Prepare a Complete Statement of Cash Flows using the Indirect Method.

(2) Prepare ONLY the Operating Activities of the Statement of Cash Flows using the Direct Method.

	HANNAH BARBERRA COMPANY
	COMPARATIVE BALANCE SHEET
	DECEMBER 31, 2023 & 2022
	2023		2022
ASSETS:
Cash	$42,073		$47,075
Accounts Receivable	28,000		30,735
Inventory	132,000		123,550
Prepaid Expenses	5,570		5,800
Equipment	110,500		100,000
Accumulated Depreciation	-55,375		-47,500
TOTAL ASSETS	$262,768		$259,660
LIABILITIES & STOCKHOLDERS' EQUITY:
Accounts Payable	$17,588		$47,000
Short-term Notes Payable	8,000		6,000
Long-term Notes Payable	51,250		38,750
Common Stock, $5 Par	105,500		100,000
Paid-In-Capital Excess Par	11,000		0
Retained Earnings	73,930		67,910
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY	$262,768		$259,660
	HANNAH BARBERRA COMPANY
	INCOME STATEMENT
	YEAR ENDED 12/31/23
Sales		$400,000
Cost of Goods Sold		-250,000
Gross Profit		$150,000
OPERATING EXPENSES:
Depreciation Expense	18,100
Other Expenses	89,000
TOTAL OPERATIING EXPENSES		-107,100
OPERATING INCOME		$42,900
Other Gains (Losses)
Loss on Sale of Equipment		-2,400
INCOME BEFORE TAXES		$40,500
Income Tax Expense		-9,525
NET INCOME		$30,975
ADDITIONAL INFORMATION ON YEAR 2023 TRANSACTIONS:
(1) Sold equipment for $13,425.
(2) Purchased equipment costing $36,000 paying $10,000 cash and signing a long-term Note Payable for $26,000.
(3) Paid $15,300 to reduce the long-term Notes Payable
(4) Borrowed $2,000 by signing a short-term Notes Payable
(5) Declared and Paid Cash Dividends of $28,205
(6) Issued 1,100 shares of Common Stock for $15 per share.

Answer rating: 100% (QA)

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