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Cash Flows Statement Practice 2021

The document provides financial data for Lion Corp for the years ended December 31, 2021, and 2020, including a balance sheet and income statement. It outlines key transactions such as the sale of old equipment, purchase of new equipment, payment of dividends, and issuance of additional shares. The task is to prepare a statement of cash flows for 2021 using the indirect method.

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5 views2 pages

Cash Flows Statement Practice 2021

The document provides financial data for Lion Corp for the years ended December 31, 2021, and 2020, including a balance sheet and income statement. It outlines key transactions such as the sale of old equipment, purchase of new equipment, payment of dividends, and issuance of additional shares. The task is to prepare a statement of cash flows for 2021 using the indirect method.

Uploaded by

harjotsinghchahal7
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

CHAPTER 16 STATEMENT OF CASH FLOWS PRACTICE QUESTION

Lion Corp had the following financial data related to the years ended December 31:

December 31,

BALANCE SHEET 2021 2020

Cash $42,740 $56,980

Accounts receivable 23,500 21,500

Merchandise inventory 45,000 122,000

Long-term investments 202,000 120,000

Equipment 320,000 201,000

Accumulated depreciation, equipment 64,000 35,000

$569,240 $486,480

Accounts payable $16,200 $13,200

Income taxes payable 23,000 22,300

Bonds payable 44,500 64,000

Common shares 152,000 133,000

Retained earnings 333,540 253,980

$569,240 $486,480

INCOME STATEMENT

Sales (all on credit) $479,892

Cost of goods sold $161,644

Depreciation expense 44,000

Other operating expenses 56,431

Interest expense 10,185

Loss on sale of equipment 3,822 276,082


Profit $203,810

(1) Old equipment with an original cost of $40,000 with accumulated depreciation of
$15,000 was sold for $21,178.

(2) New equipment was purchased for cash.

(3) Dividends were declared and paid during the year.

(4) Additional shares were issued during the year.

Prepare a statement of cash flows for the year ended December 31, 2021, using the indirect
method.

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