The management of Banciu Corporation provides you with comparative balance sheets at December 31, 20X1, and...
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The management of Banciu Corporation provides you with comparative balance sheets at December 31, 20X1, and December 31, 20X0, appearing below. Assets Cash Accounts receivable Allowance for uncollectible accounts Inventories Machinery and equipment. Accumulated depreciation on machinery and equipment Leasehold improvements Accumulated amortization on leasehold improvements Securities held for plant expansion Patents Totals Liabilities and stockholders' equity Accounts payable Dividend payable Current portion of 6% serial bonds payable 6% serial bonds payable-noncurrent portion Preferred stock Common stock Retained earnings Totals December 31, 20X1 20X0 $ 174,000 $ 223,200 306,000 327,600 (20,400) (19,200) 579,600 645,600 1,112,400 776,400 (446,400) (499, 200) 104,400 104,400 (58,800) (69,600) 180,000 33,360 0 36,000 $1,901,760 $1,587,600 $ 279,360 $ 126,000 48,000 60,000 0 60,000 360,000 120,000 300,000 108,000 600,000 600,000 506,400 321,600 $1,901,760 $1,587,600 Supplemental Information: a. The following table presents a comparative analysis of retained earnings as of December 31, 20X1, and December 31, 20X0. Beginning balance Net income Dividends declared Premium on repurchased preferred Stock Ending balance December 31, 20X1 $321,600 234,000 555,600 (48,000) (1,200) $506,400 20X0 $157, 200 206,400 363,600 (42,000) -0- $321,600 b. On December 10, 20X1, the board of directors declared a cash dividend of $0.24 per share, payable to holders of common stock on January 10, 20X2. c. Purchased new machinery for $463,000. In addition, Banciu sold certain machinery it was no longer using for $57,600. The machinery cost $127,000 and had accumulated depreciation of $53,800 at the date of the sale. Banciu made no other entries in Machinery and equipment or related accounts other than for depreciation. d. Purchased 120 preferred shares, par value $100, at $110 and subsequently canceled the shares. Banciu debited the premium paid to Retained earnings. e. Paid $2,400 of legal costs in successful defense of a new patent, which it correctly debited to the Patents account. It recorded patent amortization amounting to $5,040 during the year ended December 31, 20X1. f. During 20X1, Banciu wrote off accounts receivable totaling $3,600 as uncollectible. g. During 20X1, Banciu purchased $180,000 of securities that are being held for future plant expansion. Required: 1. Prepare the entries (in general journal form) that would be entered into T-accounts needed to prepare a statement of cash flows from the data given. For example, the first entry would be Cash (Operations-Net income) Retained earnings $ 234,000 $ 234,000 2. Prepare a statement of cash flows for Banciu Corporation for 20X1. Use the indirect method for presenting cash flow from operations. The management of Banciu Corporation provides you with comparative balance sheets at December 31, 20X1, and December 31, 20X0, appearing below. Assets Cash Accounts receivable Allowance for uncollectible accounts Inventories Machinery and equipment. Accumulated depreciation on machinery and equipment Leasehold improvements Accumulated amortization on leasehold improvements Securities held for plant expansion Patents Totals Liabilities and stockholders' equity Accounts payable Dividend payable Current portion of 6% serial bonds payable 6% serial bonds payable-noncurrent portion Preferred stock Common stock Retained earnings Totals December 31, 20X1 20X0 $ 174,000 $ 223,200 306,000 327,600 (20,400) (19,200) 579,600 645,600 1,112,400 776,400 (446,400) (499, 200) 104,400 104,400 (58,800) (69,600) 180,000 33,360 0 36,000 $1,901,760 $1,587,600 $ 279,360 $ 126,000 48,000 60,000 0 60,000 360,000 120,000 300,000 108,000 600,000 600,000 506,400 321,600 $1,901,760 $1,587,600 Supplemental Information: a. The following table presents a comparative analysis of retained earnings as of December 31, 20X1, and December 31, 20X0. Beginning balance Net income Dividends declared Premium on repurchased preferred Stock Ending balance December 31, 20X1 $321,600 234,000 555,600 (48,000) (1,200) $506,400 20X0 $157, 200 206,400 363,600 (42,000) -0- $321,600 b. On December 10, 20X1, the board of directors declared a cash dividend of $0.24 per share, payable to holders of common stock on January 10, 20X2. c. Purchased new machinery for $463,000. In addition, Banciu sold certain machinery it was no longer using for $57,600. The machinery cost $127,000 and had accumulated depreciation of $53,800 at the date of the sale. Banciu made no other entries in Machinery and equipment or related accounts other than for depreciation. d. Purchased 120 preferred shares, par value $100, at $110 and subsequently canceled the shares. Banciu debited the premium paid to Retained earnings. e. Paid $2,400 of legal costs in successful defense of a new patent, which it correctly debited to the Patents account. It recorded patent amortization amounting to $5,040 during the year ended December 31, 20X1. f. During 20X1, Banciu wrote off accounts receivable totaling $3,600 as uncollectible. g. During 20X1, Banciu purchased $180,000 of securities that are being held for future plant expansion. Required: 1. Prepare the entries (in general journal form) that would be entered into T-accounts needed to prepare a statement of cash flows from the data given. For example, the first entry would be Cash (Operations-Net income) Retained earnings $ 234,000 $ 234,000 2. Prepare a statement of cash flows for Banciu Corporation for 20X1. Use the indirect method for presenting cash flow from operations.
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Related Book For
Financial Reporting And Analysis
ISBN: 9781260247848
8th Edition
Authors: Lawrence Revsine, Daniel Collins, Bruce Johnson, Fred Mittelstaedt, Leonard Soffer
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