The following are Shamrock Corp.s comparative balance sheet accounts at December 31, 2020 and 2019, with a
Question:
The following are Shamrock Corp.’s comparative balance sheet accounts at December 31, 2020 and 2019, with a column showing the increase (decrease) from 2019 to 2020.
COMPARATIVE BALANCE SHEETS | |||||||||
2020 | 2019 | Increase | |||||||
Cash | $811,100 | $702,700 | $108,400 | ||||||
Accounts receivable | 1,139,100 | 1,176,000 | (36,900 | ) | |||||
Inventory | 1,847,000 | 1,704,500 | 142,500 | ||||||
Property, plant, and equipment | 3,317,700 | 2,945,400 | 372,300 | ||||||
Accumulated depreciation | (1,158,000 | ) | (1,048,400 | ) | (109,600 | ) | |||
Investment in Myers Co. | 312,200 | 274,000 | 38,200 | ||||||
Loan receivable | 250,000 | — | 250,000 | ||||||
Total assets | $6,519,100 | $5,754,200 | $764,900 | ||||||
Accounts payable | $1,010,900 | $960,700 | $50,200 | ||||||
Income taxes payable | 29,900 | 50,500 | (20,600 | ) | |||||
Dividends payable | 80,600 | 100,700 | (20,100 | ) | |||||
Lease liabililty | 432,100 | — | 432,100 | ||||||
Common stock, $1 par | 500,000 | 500,000 | — | ||||||
Paid-in capital in excess of par—common stock | 1,499,300 | 1,499,300 | — | ||||||
Retained earnings | 2,966,300 | 2,643,000 | 323,300 | ||||||
Total liabilities and stockholders’ equity | $6,519,100 | $5,754,200 | $764,900 |
Additional information:
1. | On December 31, 2019, Shamrock acquired 25% of Myers Co.’s common stock for $274,000. On that date, the carrying value of Myers’s assets and liabilities, which approximated their fair values, was $1,096,000. Myers reported income of $152,800 for the year ended December 31, 2020. No dividend was paid on Myers’s common stock during the year. | |
2. | During 2020, Shamrock loaned $332,200 to TLC Co., an unrelated company. TLC made the first semiannual principal repayment of $82,200, plus interest at 10%, on December 31, 2020. | |
3. | On January 2, 2020, Shamrock sold equipment costing $59,800, with a carrying amount of $38,000, for $40,100 cash. | |
4. | On December 31, 2020, Shamrock entered into a capital lease for an office building. The present value of the annual rental payments is $432,100, which equals the fair value of the building. Shamrock made the first rental payment of $60,300 when due on January 2, 2021. | |
5. | Net income for 2020 was $403,900. | |
6. | Shamrock declared and paid the following cash dividends for 2020 and 2019. |
2020 | 2019 | |||
Declared | December 15, 2020 | December 15, 2019 | ||
Paid | February 28, 2021 | February 28, 2020 | ||
Amount | $80,600 | $100,700 |
Prepare a statement of cash flows for Shamrock Corp. for the year ended December 31, 2020, using the indirect method