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15-5
15-6
15-7
15-8
A)
B)
C)
D)
15-9
15-10
15-11
15-12
15-13
15-14
Beginning
Balance
$ 47,000
23,000
66,000
136,000
356,000
184,000
172,000
$308,000
$ 31,000
22,000
64,000
117,000
338,000
161,000
177,000
$294,000
$ 17,000
32,000
25,000
11,000
85,000
83,000
38,000
206,000
$ 16,000
31,000
27,000
13,000
87,000
80,000
34,000
201,000
27,000
75,000
102,000
$308,000
24,000
69,000
93,000
$294,000
The company's net income (loss) for the year was $10,000 and its cash dividends were
$4,000. The total dollar amount of all of the items that would be classified as sources
when compiling a simplified statement of cash flows is:
A) $29,000
B) $16,000
C) $45,000
D) $25,000
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 1 Level: Medium
15-15
15-16
$10,000
23,000
1,000
1,000
3,000
4,000
3,000
$45,000
Beginning
Balance
$ 40,000
19,000
67,000
126,000
358,000
156,000
202,000
$328,000
$ 33,000
21,000
69,000
123,000
339,000
132,000
207,000
$330,000
$ 18,000
35,000
23,000
19,000
95,000
82,000
25,000
202,000
$ 19,000
37,000
19,000
22,000
97,000
86,000
23,000
206,000
23,000
103,000
126,000
$328,000
22,000
102,000
124,000
$330,000
The company's net income (loss) for the year was $5,000 and its cash dividends were
$4,000. The total dollar amount of all of the items that would be classified as uses
when compiling a simplified statement of cash flows is:
A) $7,000
B) $40,000
C) $29,000
D) $33,000
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 1 Level: Medium
15-17
15-18
$19,000
1,000
2,000
3,000
4,000
4,000
$33,000
$117,00
0
$31,000
$45,000
$20,000
$8,000
$3,000
What is Penha's net cash provided by operating activities for last year on the statement
of cash flows? (Assume that current liabilities do not contain any notes payable.)
A) $108,000
B) $116,000
C) $136,000
D) $139,000
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
Solution:
Net income............................................................................
Adjustments needed to convert net income to a cash basis:
Depreciation charges..........................................................
Add (deduct) changes in current asset accounts affecting
revenue or expense:
Increase in all current assets except cash...........................
Add (deduct) changes in current liability accounts affecting
revenue or expense:
Increase in current liabilities..............................................
Add (deduct) gains or losses on sale of assets:
Gain on sale of investments...............................................
Net cash provided by operating activities.............................
$117,000
8,000
(
31,000)
45,000
3,000)
$136,000
15-19
$8,000
$(3,000)
$4,000
$18,000
$6,000
$(4,000)
$10,000
Based solely on this information, the net cash provided by operations under the
indirect method on the statement of cash flows would be:
A) $16,000
B) $45,000
C) $38,000
D) $25,000
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Hard
Solution:
Net income.........................................................................
Adjustments needed to convert net income to cash basis:
Depreciation charges.......................................................
Add (deduct) changes in current asset accounts
affecting revenue or expense:
Increase in accounts receivable...................................
Decrease in inventory..................................................
Increase in prepaid expenses.......................................
Add (deduct) changes in current liability accounts
affecting revenue or expense:
Increase in accounts payable.......................................
Decrease in taxes payable............................................
Net cash provided by operating activities..........................
15-20
$27,000
18,000
(
(
8,000)
3,000
4,000)
6,000
4,000)
$38,000
$8,000
$9,000
$(3,000)
$15,000
$(5,000)
$11,000
$7,000
$0
Based solely on this information, the net cash provided by operations under the
indirect method on the statement of cash flows would be:
A) $63,000
B) $36,000
C) $7,000
D) $35,000
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
15-21
$21,000
15,000
(
(
8,000)
9,000)
3,000
5,000)
11,000
7,000
$35,000
44. Alaric Corporation recently sold equipment for $16,000. The equipment was
purchased five years ago for $100,000. The accumulated depreciation on the
equipment on the date of sale was $75,000. Alaric uses the indirect method to prepare
its statement of cash flows. What net effect will this sale have on the investing
activities section of Alaric's statement of cash flows for the current year?
A) no effect
B) $7,000 increase
C) $9,000 decrease
D) $16,000 increase
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
15-22
$ 28
22
28
151
16
55
200
$500
$ 29
20
24
200
17
50
22
$362
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
$1,48
5
989
496
172
324
19
343
103
$ 240
Cash dividends were $62. The company sold equipment for $19 that was originally
purchased for $5 and that had accumulated depreciation of $5. The net cash provided
by (used by) operations for the year was:
A) $255
B) $236
C) $324
D) $298
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
15-23
15-24
$240
13
(
4)
2
1)
2
4
19)
1)
$236
$ 41
26
16
127
18
63
28
$319
$ 45
25
17
120
19
60
59
$345
$386
239
147
185
( 38)
8
(30)
0
($ 30)
Cash dividends were $1. The company sold equipment for $19 that was originally
purchased for $15 and that had accumulated depreciation of $4. The net cash provided
by (used by) investing activities for the year was:
A) ($18)
B) ($1)
C) $1
D) $19
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
15-25
($18) *
19
$ 1
$ 42
65
65
666
( 258)
$580
$ 38
56
57
530
( 230)
$451
$ 33
16
14
167
25
64
261
$580
$ 40
17
12
200
24
60
98
$451
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
15-26
Beginning
Balance
$1,093
671
422
145
277
20
297
89
$ 208
($33)
4
( 45)
($74)
15-27
$ 46
22
18
22
17
61
191
$377
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$532
324
208
137
71
21
$ 50
$ 55
20
21
30
16
60
150
$352
Cash dividends were $9. The net cash provided by (used by) operations for the year
was:
A) $46
B) $71
C) $54
D) $4
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
15-28
$50
23
2)
8)
9)
2
( 3)
1
$54
(
(
(
15-29
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 22
79
69
543
( 202)
$511
$ 20
74
65
420
( 175)
$404
$ 65
17
19
11
14
64
321
$511
$ 59
19
18
10
19
60
219
$404
Net income for the year was $129. Cash dividends were $27. The net cash provided by
(used by) operations for the year was:
A) $184
B) $147
C) $111
D) $18
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
15-30
$129
27
5)
4)
6
(
2)
1
(
5)
$147
(
(
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 24
33
75
689
( 314)
$507
$ 22
35
66
530
( 268)
$385
$ 45
19
10
26
21
71
315
$507
$ 46
20
9
30
20
70
190
$385
The net income for the year was $159. Cash dividends were $34. The net cash
provided by (used by) investing activities for the year was:
A) ($159)
B) ($113)
C) $159
D) $113
15-31
($159)
($159)
*$689 $530
51. Minshall Corporation's most recent balance sheet appears below:
Comparative Balance Sheet
Ending
Balance
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 22
32
50
573
( 297)
$380
$ 20
36
62
510
( 275)
$353
$ 46
12
9
132
19
42
120
$380
$ 45
15
8
120
25
40
100
$353
The net income for the year was $26. Cash dividends were $6. The net cash provided
by (used by) financing activities for the year was:
A) $2
B) $8
C) $12
D) ($6)
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
15-32
$12
2
( 6)
$ 8
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 37
27
45
602
( 262)
$449
$ 32
28
51
530
( 257)
$384
$ 51
77
22
299
$449
$ 46
110
20
208
$384
The net income for the year was $121. Cash dividends were $30. The net cash
provided by (used by) operations for the year was:
A) $173
B) $138
C) $17
D) $104
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
15-33
$121
5
1
6
5
$138
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 26
32
55
552
( 324)
$341
$ 22
27
56
490
( 288)
$307
$ 48
214
32
47
$341
$ 47
250
30
( 20)
$307
The net income for the year was $91. Cash dividends were $24. The net cash provided
by (used by) investing activities for the year was:
A) $26
B) $62
C) ($26)
D) ($62)
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
15-34
($62)
($62)
*$552 $490
54. Hanna Corporation's most recent balance sheet appears below:
Comparative Balance Sheet
Ending
Balance
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 31
44
68
626
( 340)
$429
$ 32
45
69
510
( 303)
$353
$ 39
311
61
18
$429
$ 38
300
60
( 45)
$353
The net income for the year was $84. Cash dividends were $21. The net cash provided
by (used by) financing activities for the year was:
A) ($9)
B) $1
C) ($21)
D) $11
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
15-35
$11
1
( 21)
($ 9)
55. Last year Cummins Company reported a cost of goods sold of $50,000. Inventories
increased by $10,000 during the year, and accounts payable increased by $2,000. The
company uses the direct method to determine the net cash provided by operating
activities on the statement of cash flows. The cost of goods sold adjusted to a cash
basis would be:
A) $42,000
B) $58,000
C) $48,000
D) $60,000
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting Appendix: 15 LO: 2,4 Level: Medium
Solution:
Cost of goods sold (as reported)................ $50,000
Adjustments to a cash basis:
Increase in inventory...............................
10,000
Increase in accounts payable................... ( 2,000)
Cost of goods sold (adjusted)..................... $58,000
15-36
$120,000
( 20,000)
$100,000
57. Cridge Company's selling and administrative expenses for last year totaled $170,000.
During the year the company's prepaid expense account balance increased by $9,000
and accrued liabilities decreased by $13,000. Depreciation charges for the year were
$15,000. Based on this information, selling and administrative expenses adjusted to a
cash basis under the direct method on the statement of cash flows would be:
A) $177,000
B) $207,000
C) $133,000
D) $163,000
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting Appendix: 15 LO: 2,4 Level: Medium
15-37
15-38
$170,000
9,000
13,000
15,000)
$177,000
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 23
51
55
720
( 297)
$552
$ 22
52
49
570
( 291)
$402
$ 36
14
11
66
19
35
371
$552
$ 34
15
12
70
21
30
220
$402
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
$1,264
828
436
152
284
13
297
89
$ 208
15-39
$1,264
828
15-40
1
$1,265
6
2)
832
152
1
12)
141
89
1
2
92
$ 200
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 35
73
54
438
( 212)
$388
$ 34
75
63
360
( 199)
$333
$61
20
14
80
11
24
178
$388
$63
21
16
110
15
20
88
$333
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$920
606
314
157
157
47
$110
Cash dividends were $20. The net cash provided by (used by) operations for the year
was:
A) $125
B) $95
C) $15
D) $157
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting Appendix: 15 LO: 2,4 Level: Medium
15-41
$920
606
15-42
2
$922
9)
2
599
157
1
13)
145
47
2
4
53
$125
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 38
55
44
584
( 327)
$394
$ 32
59
46
480
( 278)
$339
$ 28
293
55
18
$394
$ 27
320
50
( 58)
$339
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$883
580
303
164
139
42
$ 97
Cash dividends were $21. The net cash provided by (used by) operations for the year
was:
A) $139
B) $153
C) $41
D) $56
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting Appendix: 15 LO: 2,4 Level: Easy
15-43
$883
580
4
$887
(
(
2)
1)
577
164
49)
115
42
$153
61. Last year Martson Company sold equipment with a net book value of $110,000 for
$130,000 in cash. This equipment was originally purchased for $200,000. What will
be the net effect of this transaction on the net cash provided by investing activities on
the statement of cash flows?
A) A net deduction of $70,000 from cash.
B) A net addition of $70,000 to cash.
C) A net deduction of $20,000 from cash.
D) A net addition of $20,000 to cash.
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2 Level: Hard
Solution:
Investing Activities
Disposal of equipment..............................
Proceeds from sale of equipment.............
Net cash used in investing activities........
15-44
($200,000)
130,000
($ 70,000)
$100,00
0
$7,000
$2,000
$25,000
$90,000
$9,000
$120,00
0
Based solely on the above information, the net cash provided by financing activities
for the year on the statement of cash flows would be:
A) $3,000
B) $(131,000)
C) $(22,000)
D) $353,000
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2 Level: Hard
Solution:
Financing Activities
Increase in common stock........................
Cash dividends paid.................................
Decrease in bonds payable.......................
Net cash provided by financing activities
$100,000
(
7,000)
( 90,000)
$ 3,000
63. Last year Burdic Company's cash account decreased by $4,000. Net cash provided by
investing activities was $31,000. Net cash used in financing activities was $38,000.
On the statement of cash flows, the net cash flow provided by (used in) operating
activities was:
A) $(4,000)
B) $(11,000)
C) $(7,000)
D) $3,000
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 3 Level: Medium
15-45
($ 4,000)
( 31,000)
38,000
$ 3,000
15-46
$ 31,000
18,000
70,000
119,000
374,000
190,000
184,000
$303,00
0
$ 28,000
20,000
66,000
114,000
354,000
165,000
189,000
$303,000
$ 13,000
31,000
28,000
21,000
93,000
76,000
39,000
208,000
$ 9,000
33,000
29,000
20,000
91,000
73,000
40,000
204,000
28,000
67,000
95,00
0
$303,00
0
26,000
73,000
99,000
$303,000
15-47
15-48
$ 2,000
25,000
4,000
1,000
3,000
2,000
$37,000
68. The total dollar amount of all of the items that would be classified as uses when
compiling a simplified statement of cash flows is:
A) $34,000
B) $3,000
C) $37,000
D) $28,000
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 1 Level: Medium
15-49
$ 3,000
4,000
20,000
2,000
1,000
1,000
3,000
$34,000
15-50
$ 37,000
20,000
70,000
127,000
424,000
231,000
193,000
$320,000
Beginning
Balance
$ 29,000
24,000
68,000
121,000
399,000
200,000
199,000
$320,000
$ 19,000
36,000
21,000
22,000
98,000
77,000
26,000
201,000
$ 17,000
33,000
18,000
18,000
86,000
80,000
24,000
190,000
31,000
88,000
119,000
$320,000
30,000
100,000
130,000
$320,000
69. Which of the following classifications of changes in balance sheet accounts as sources
and uses is correct?
A) The change in Accounts Receivable is a source; The change in Inventory is a
source
B) The change in Accounts Receivable is a source; The change in Inventory is a
use
C) The change in Accounts Receivable is a use; The change in Inventory is a
source
D) The change in Accounts Receivable is a use; The change in Inventory is a use
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 1 Level: Easy
70. Which of the following classifications of changes in balance sheet accounts as sources
and uses is correct?
A) The change in Accounts Payable is a source; The change in Accrued Wages and
Salaries payable is a use
B) The change in Accounts Payable is a use; The change in Accrued Wages and
Salaries payable is a use
C) The change in Accounts Payable is a source; The change in Accrued Wages and
Salaries payable is a source
D) The change in Accounts Payable is a use; The change in Accrued Wages and
Salaries payable is a source
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 1 Level: Easy
15-51
15-52
Beginning
Balance
$ 42,000
22,000
66,000
130,000
401,000
207,000
194,000
$324,000
$ 31,000
18,000
70,000
119,000
377,000
177,000
200,000
$319,000
$ 15,000
33,000
24,000
12,000
84,000
83,000
29,000
196,000
$ 17,000
29,000
28,000
9,000
83,000
81,000
33,000
197,000
27,000
101,000
128,000
$324,000
28,000
94,000
122,000
$319,000
The company's net income (loss) for the year was $11,000 and its cash dividends were
$4,000.
15-53
$11,000
4,000
30,000
4,000
3,000
2,000
$54,000
73. The total dollar amount of all of the items that would be classified as uses when
compiling a simplified statement of cash flows is:
A) $11,000
B) $39,000
C) $54,000
D) $43,000
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 1 Level: Medium
15-54
$ 4,000
24,000
2,000
4,000
4,000
1,000
4,000
$43,000
15-55
Accumulated depreciation...................
Total assets...........................................
Beginning
Balance
$ 22,000
60,000
36,000
11,000
230,000
440,000
( 276,000
( 306,000)
)
$549,000 $523,000
Accounts payable.................................
Accrued liabilities................................
Taxes payable.......................................
Bonds payable......................................
Deferred taxes......................................
Common stock.....................................
Retained earnings.................................
Total liabilities and owners equity......
$ 43,000
20,000
6,000
130,000
22,000
120,000
208,000
$549,000
Cash......................................................
Accounts receivable.............................
Inventory..............................................
Prepaid expenses..................................
Long-term investments........................
Plant and equipment.............................
Ending
Balance
$ 27,000
56,000
48,000
14,000
270,000
440,000
$ 33,000
25,000
9,000
150,000
20,000
110,000
176,000
$523,000
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$510,00
0
280,000
230,000
150,000
80,000
24,000
$ 56,000
The company declared and paid $24,000 in cash dividends during the year. The following
questions pertain to the company's statement of cash flows.
15-56
$56,000
$30,000
4,000
( 12,000)
( 3,000)
10,000
( 5,000)
( 3,000)
2,000
23,000
$79,000
75. The net cash provided by (used in) investing activities last year was:
A) $(40,000)
B) $40,000
C) $(30,000)
D) $30,000
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
Solution:
Investing Activities
Increase in long-term investments.............
Net cash used in investing..........................
($40,000
)
($40,000
)
15-57
15-58
($20,000)
10,000
( 24,000)
($34,000)
$(4,000)
$(8,000)
$13,000
$(9,000)
$60,000
$45,000
Credit balances:
Accumulated depreciation..........
Accounts payable........................
Accrued liabilities.......................
Taxes payable.............................
Bonds payable.............................
Deferred taxes.............................
Common stock............................
Retained earnings........................
$56,000
$3,000
$8,000
$(2,000)
$(60,000)
$6,000
$20,000
$66,000
The company declared and paid cash dividends of $117,000 last year. The following
questions pertain to the company's statement of cash flows.
77. The net cash provided by (used in) operating activities last year was:
A) $258,000
B) $183,000
C) $239,000
D) $202,000
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
15-59
$183,000
$56,000
8,000
( 13,000)
9,000
3,000
8,000
( 2,000)
6,000
75,000
$258,000
78. The net cash provided by (used in) investing activities last year was:
A) $(105,000)
B) $105,000
C) $(85,000)
D) $85,000
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
Solution:
Investing Activities
Additions to plant and equipment............
Additions to long-term investments.........
Net cash used by investing activities.......
15-60
($ 45,000)
( 60,000)
($105,000)
($ 60,000)
20,000
( 117,000)
($157,000)
$170,00
0
$90,000
$33,000
$13,000
$370,00
0
$5,000
$210,00
0
$430,00
0
On the statement of cash flows, some of these events are classified as operating activities,
some are classified as investing activities, and some are classified as financing activities.
15-61
$170,000
( 33,000)
( 370,000)
($233,000)
81. Based solely on the information above, the net cash provided by (used in) investing
activities on the statement of cash flows would be:
A) $(310,000)
B) $(1,321,000)
C) $(520,000)
D) $(890,000)
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Hard
Solution:
Investing Activities
Purchase of bonds....................................
Collection of loan.....................................
Purchase of equipment.............................
Net cash used by investing activities.......
15-62
($ 90,000)
210,000
( 430,000)
($310,000)
$ 36
82
40
619
( 321)
$456
$ 31
74
49
540
( 303)
$391
$ 35
20
13
150
18
31
189
$456
$ 32
24
15
200
24
30
66
$391
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
$1,19
6
786
410
189
221
12
233
70
$ 163
Cash dividends were $40. The company sold equipment for $14 that was originally purchased
for $9 and that had accumulated depreciation of $7.
15-63
$163
$25
( 8)
9
3
( 4)
( 2)
( 6)
( 12)
5
$168
83. The net cash provided by (used by) investing activities for the year was:
A) ($88)
B) $14
C) ($74)
D) $74
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
Solution:
Investing Activities
Proceeds from sale of equipment...............
Purchase of plant and equipment...............
Net cash used by investing activities.........
$14
( 88) *
($74)
15-64
($50)
1
( 40)
($89)
15-65
$ 28
22
60
528
( 366)
$272
$ 27
25
54
500
( 346)
$260
$ 29
18
10
98
27
35
55
$272
$ 36
16
9
130
25
30
14
$260
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$677
431
246
175
71
21
$ 50
15-66
$50
$20
3
( 6)
( 7)
2
1
2
15
$65
86. The net cash provided by (used by) investing activities for the year was:
A) ($8)
B) $8
C) $28
D) ($28)
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
Solution:
Investing Activities
Additions to plant and equipment..............
Net cash used by investing activities.........
($28
)
($28
)
87. The net cash provided by (used by) financing activities for the year was:
A) ($36)
B) ($32)
C) $5
D) ($9)
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Medium
15-67
($32)
5
( 9)
($36)
$ 33
74
63
439
( 199)
$410
$ 28
64
56
380
( 167)
$361
$ 41
24
8
64
18
61
194
$410
$ 48
25
9
60
22
60
137
$361
Net income for the year was $76. Cash dividends were $19.
15-68
$76
$32
( 10)
( 7)
( 7)
( 1)
( 1)
( 4)
2
$78
89. The net cash provided by (used by) investing activities for the year was:
A) ($27)
B) $27
C) $59
D) ($59)
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
Solution:
Investing Activities
Additions to plant and equipment..............
Net cash used by investing activities.........
($59
)
($59
)
15-69
15-70
$ 4
1
( 19)
($14)
$ 40
73
33
529
( 296)
$379
$ 38
66
35
460
( 267)
$332
$ 31
112
82
154
$379
$ 26
150
80
76
$332
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$941
598
343
193
150
45
$105
15-71
$105
$29
( 7)
2
5
29
$134
92. The net cash provided by (used by) investing activities for the year was:
A) $40
B) ($40)
C) ($69)
D) $69
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
Solution:
Investing Activities
Additions to plant and equipment..............
Net cash used by investing activities.........
($69
)
($69
)
93. The net cash provided by (used by) financing activities for the year was:
A) ($63)
B) ($27)
C) ($38)
D) $2
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
Solution:
Financing Activities
Decrease in long-term debt......................
Increase in common stock........................
Cash dividends paid.................................
15-72
($38)
2
( 27)
($63)
15-73
$ 33
74
51
639
( 418)
$379
$ 28
66
52
550
( 349)
$347
$ 48
48
51
232
$379
$ 40
50
50
207
$347
Net income for the year was $31. Cash dividends were $6.
94. The net cash provided by (used by) operations for the year was:
A) $44
B) ($39)
C) $101
D) $70
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
15-74
$31
$69
( 8)
1
8
70
$101
95. The net cash provided by (used by) investing activities for the year was:
A) $89
B) ($89)
C) $20
D) ($20)
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
Solution:
Investing Activities
Additions to plant and equipment..............
Net cash used by investing activities.........
($89
)
($89
)
96. The net cash provided by (used by) financing activities for the year was:
A) ($2)
B) $1
C) ($6)
D) ($7)
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,3 Level: Easy
Solution:
Financing Activities
Decrease in long-term debt......................
Increase in common stock........................
Cash dividends paid.................................
($2)
1
( 6)
15-75
15-76
($7)
$ 35,000
25,000
12,000
110,000
36,000
100,000
297,000
$615,000
$ 57,000
17,000
19,000
150,000
19,000
70,000
219,000
$551,000
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$900,00
0
490,000
410,000
270,000
140,000
42,000
$ 98,000
The company declared and paid $20,000 in cash dividends during the year. The company uses
the direct method to determine the net cash provided by operating activities.
15-77
$900,000
( 23,000)
$877,000
98. On the statement of cash flows, the cost of goods sold adjusted to a cash basis would
be:
A) $494,000
B) $490,000
C) $486,000
D) $512,000
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,4 Level: Hard
Solution:
Cost of goods sold (as reported)...............
Adjustments to a cash basis:
Decrease in inventory............................
Decrease in accounts payable................
Cost of goods sold (adjusted)....................
15-78
$490,000
(
18,000)
22,000
$494,000
$270,000
(
6,000)
(
8,000)
( 38,000)
$218,000
100. On the statement of cash flows, the income tax expense adjusted to a cash basis would
be:
A) $42,000
B) $36,000
C) $49,000
D) $32,000
Ans: D AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,4 Level: Hard
Solution:
Income tax expense (as reported).............
Adjustments to a cash basis:
Decrease in accrued taxes payable........
Decrease in deferred income taxes........
Income tax expense (adjusted)..................
$42,000
7,000
( 17,000)
$32,000
15-79
$67,000
$(14,000)
$2,000
$7,000
$(60,000)
$(7,000)
$20,000
$101,000
$970,00
0
530,000
440,000
290,000
150,000
45,00
0
$105,00
0
The company declared and paid $4,000 in cash dividends during the year. The company uses
the direct method to determine the net cash provided by operating activities.
15-80
$970,000
6,000
$976,000
102. On the statement of cash flows, the cost of goods sold adjusted to a cash basis would
be:
A) $514,000
B) $544,000
C) $546,000
D) $530,000
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,4 Level: Hard
Solution:
Cost of goods sold (as reported)...............
Adjustments to a cash basis:
Increase in inventory.............................
Decrease in accounts payable................
Cost of goods sold (adjusted)....................
$530,000
2,000
14,000
$546,000
15-81
$290,000
( 13,000)
(
2,000)
( 67,000)
$208,000
104. On the statement of cash flows, the income tax expense adjusted to a cash basis would
be:
A) $40,000
B) $42,000
C) $45,000
D) $46,000
Ans: C AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,4 Level: Hard
Solution:
Income tax expense (as reported).............
Adjustments to a cash basis:
Increase in accrued taxes payable.........
Decrease in deferred income taxes........
Income tax expense (adjusted)..................
15-82
$45,000
(
7,000)
7,000
$45,000
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 27
30
64
564
( 217)
$468
$ 27
28
59
500
( 208)
$406
$ 50
27
20
184
21
83
83
$468
$ 43
24
22
180
24
80
33
$406
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
$69
0
456
234
150
84
9
93
28
$ 65
Cash dividends were $15. The company sold equipment for $11 that was originally purchased
for $3 and that had accumulated depreciation of $1.
15-83
15-84
$690
(
2)
$688
456
5
7)
454
150
(
(
3)
10)
137
28
2
3
33
$ 64
($67)
11
($56)
$ 4
3
( 15)
($ 8)
15-85
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 48
61
59
398
( 160)
$406
$ 40
60
70
350
( 146)
$374
$ 64
22
16
176
16
45
67
$406
$ 65
19
15
210
15
40
10
$374
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$72
2
465
257
146
111
33
$ 78
15-86
$722
(
1)
$721
465
11)
1
455
146
(
(
3)
14)
129
33
(
(
1)
1)
31
$106
15-87
($48
)
($48
)
110. The net cash provided by (used by) financing activities for the year was:
A) ($50)
B) ($34)
C) $5
D) ($21)
Ans: A AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,4 Level: Medium
Solution:
Financing Activities
Decrease in bonds payable.......................
Increase in common stock........................
Cash dividends paid.................................
Net cash used by financing activities.......
15-88
($34)
5
( 21)
($50)
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 32
55
57
574
( 293)
$425
$ 25
46
59
450
( 251)
$329
$ 55
15
74
281
$425
$ 56
20
70
183
$329
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$1,087
724
363
179
184
55
$ 129
15-89
$1,087
(
9)
$1,078
724
2)
1
723
179
42)
137
55
$ 163
112. The net cash provided by (used by) investing activities for the year was:
A) $82
B) ($124)
C) ($82)
D) $124
Ans: B AACSB: Analytic AICPA BB: Critical Thinking
AICPA FN: Reporting LO: 2,4 Level: Easy
Solution:
Investing Activities
Additions to plant and equipment..............
Net cash used by investing activities.........
15-90
($124
)
($124
)
($ 5)
4
( 31)
($32)
15-91
Beginning
Balance
$ 42,000
22,000
77,000
141,000
340,000
218,000
122,000
$263,000
$ 26,000
26,000
75,000
127,000
315,000
187,000
128,000
$255,000
$ 13,000
32,000
28,000
16,000
89,000
77,000
28,000
194,000
$ 14,000
33,000
30,000
15,000
92,000
78,000
25,000
195,000
28,000
41,000
69,000
$263,000
24,000
36,000
60,000
$255,000
The company's net income (loss) for the year was $7,000 and its cash dividends were
$2,000.
Required:
Classify the change for the year in each balance sheet account as a source, use, or
neither a source nor a use. (Do this only for the individual accounts-not for totals or
subtotals.)
15-92
Ending
Beginning
Balance
Balance
Change
42,000
26,000 +16,000 Neither
22,000
26,000
-4,000 Source
77,000
75,000 +2,000
Use
340,000
315,000 +25,000
Use
218,000
187,000 +31,000 Source
13,000
32,000
28,000
16,000
77,000
28,000
28,000
41,000
14,000
33,000
30,000
15,000
78,000
25,000
24,000
36,000
-1,000
-1,000
-2,000
+1,000
-1,000
+3,000
+4,000
+5,000
Use
Use
Use
Source
Use
Source
Source
*
*The change in retained earnings consists of two elements: net income (loss) and
dividends. The net income of $7,000 is classified as a source and the dividends of
$2,000 are classified as a use.
AACSB: Analytic AICPA BB: Critical Thinking
LO: 1 Level: Easy
15-93
$15,000
$35,000
$22,000
$28,000
$81,000
$27,000
$39,000
$42,000
$12,000
$38,000
$18,000
$24,000
$85,000
$24,000
$36,000
$45,000
The company's net income (loss) for the year was $1,000 and its cash dividends were
$4,000.
Required:
Classify the change for the year in each balance sheet account as a source, use, or
neither a source nor a use.
15-94
Ending
Beginning
Balance
Balance
Change
40,000
28,000 +12,000 Neither
17,000
14,000 +3,000
Use
60,000
62,000
-2,000 Source
406,000
383,000 +23,000
Use
234,000
205,000 +29,000 Source
15,000
35,000
22,000
28,000
81,000
27,000
39,000
42,000
12,000
38,000
18,000
24,000
85,000
24,000
36,000
45,000
+3,000
-3,000
+4,000
+4,000
-4,000
+3,000
+3,000
-3,000
Source
Use
Source
Source
Use
Source
Source
*
*The change in retained earnings consists of two elements: net income (loss) and
dividends. The net income of $1,000 is classified as a source and the dividends of
$4,000 are classified as a use.
AACSB: Analytic AICPA BB: Critical Thinking
LO: 1 Level: Easy
15-95
$29,000
$(21,000)
$12,000
$(8,000)
$80,000
$10,000
Credit balances:
Accumulated depreciation....
Accounts payable..................
Accrued liabilities.................
Taxes payable.......................
Bonds payable.......................
Deferred taxes.......................
Common stock......................
Retained earnings..................
$26,000
$23,000
$14,000
$(9,000)
$(50,000)
$4,000
$20,000
$74,000
The company declared and paid cash dividends of $45,000 last year.
Required:
a. Construct in good form the operating activities section of the company's statement
of cash flows for the year. (Use the indirect method.)
b. Construct in good form the investing activities section of the company's statement
of cash flows for the year.
c. Construct in good form the financing activities section of the company's statement
of cash flows for the year.
15-96
$119,000
$26,000
21,000
(12,000)
8,000
23,000
14,000
(9,000)
4,000
75,000
$194,000
b. Investing activities:
Increase in long-term investments................
Increase in plant & equipment......................
Net cash used for investing activities............
$(80,000
)
(10,000)
$(90,000
)
c. Financing activities:
Decrease in bonds payable............................
Increase in common stock.............................
Cash dividends..............................................
Net cash used in financing activities.............
AACSB: Analytic AICPA BB: Critical Thinking
LO: 2,3 Level: Medium
$(50,000
)
20,000
(45,000)
$(75,000
)
AICPA FN: Measurement
15-97
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 35
54
67
580
( 316)
$420
$ 30
49
58
530
( 313)
$354
$ 51
26
11
77
25
33
197
$420
$ 57
24
10
90
24
30
119
$354
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
$620
381
239
103
136
20
156
47
$109
Cash dividends were $31. The company sold equipment for $20 that was originally
purchased for $14 and that had accumulated depreciation of $14.
Required:
Prepare a statement of cash flows for the year using the indirect method.
15-98
$109
17
(5)
(9)
(6)
2
1
1
(20)
90
20
(64)
(44)
(13)
3
(31)
(41)
5
30
$35
15-99
Beginning
Balance
Assets:
Cash and cash equivalents.........................
Accounts receivable...................................
Inventory....................................................
Plant and equipment...................................
Accumulated depreciation.........................
Total assets.................................................
$ 27
43
40
467
( 264)
$313
$ 25
48
49
410
( 221)
$311
$ 49
14
25
100
16
74
35
$313
$ 61
16
22
120
19
70
3
$311
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
$546
363
183
134
49
8
57
17
$ 40
Cash dividends were $8. The company sold equipment for $12 that was originally
purchased for $9 and that had accumulated depreciation of $5.
Required:
Determine the net cash provided by (used by) operating activities for the year using
the indirect method.
15-100
$40
48
5
9
(12)
(2)
3
(3)
( 8)
$80
15-101
$ 45,000
14,000
32,000
70,000
29,000
90,000
405,000
$685,000
$ 27,000
19,000
15,000
110,000
25,000
70,000
355,000
$621,000
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
15-102
$540,00
0
220,000
320,000
200,000
120,000
36,000
$ 84,000
$29,000
14,000
(13,000)
(3,000)
18,000
(5,000)
17,000
4,000
$84,000
61,00
0
$145,00
0
15-103
$540,00
0
+14,000
220,000
+13,000
-18,000
200,000
36,000
+3,000
+5,000
-29,000
-17,000
-4,000
$554,00
0
215,000
179,000
15,000
$145,00
0
$(70,000
)
$(40,000
)
20,000
( 34,000)
15-104
$(54,000
)
AICPA FN: Measurement
$ 27
57
62
685
( 404)
$427
$ 26
53
55
580
( 355)
$359
$ 37
21
15
171
18
32
133
$427
$ 46
25
18
170
22
30
48
$359
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$89
5
557
338
177
161
4
8
$11
3
15-105
15-106
$113
49
(4)
(7)
(9)
(4)
(3)
( 4)
131
( 105)
( 105)
1
2
( 28)
( 25)
1
26
$ 27
AICPA FN: Measurement
$ 44
82
71
537
( 240)
$494
$ 38
69
69
500
( 201)
$475
$ 70
24
19
226
19
22
114
$494
$ 60
21
22
300
18
20
34
$475
The net income for the year was $108. Cash dividends were $28.
Required:
Prepare a statement of cash flows in good form using the indirect method.
15-107
15-108
$108
39
(13)
(2)
10
3
(3)
1
143
( 37)
( 37)
(74)
2
( 28)
( 100)
6
38
$ 44
AICPA FN: Measurement
Beginning
Balance
Assets:
Cash and cash equivalents.............................
Accounts receivable.......................................
Inventory........................................................
Plant and equipment.......................................
Accumulated depreciation.............................
Total assets.....................................................
$ 36
46
53
472
( 218)
$389
$ 33
41
59
460
( 214)
$379
$ 52
289
84
( 36)
$389
$ 62
330
80
( 93)
$379
Income Statement
Sales...............................................................
Cost of goods sold..........................................
Gross margin..................................................
Selling and administrative expense................
Net operating income.....................................
Income taxes..................................................
Net income.....................................................
$73
7
454
283
173
110
33
$ 77
15-109
15-110
$77
4
(5)
6
( 10)
72
( 12)
( 12)
( 41)
4
( 20)
( 57)
3
33
$36
AICPA FN: Measurement
Beginning
Balance
Assets:
Cash and cash equivalents.............................
Accounts receivable.......................................
Inventory........................................................
Plant and equipment.......................................
Accumulated depreciation.............................
Total assets.....................................................
$ 29
21
49
524
( 283)
$340
$ 27
25
56
420
( 251)
$277
$ 28
84
51
177
$340
$ 34
100
50
93
$277
Net income for the year was $105. Cash dividends were $21.
Required:
Prepare a statement of cash flows in good form using the indirect method.
15-111
15-112
$105
32
4
7
( 6)
142
( 104)
( 104)
(16)
1
( 21)
( 36)
2
27
$ 29
$ 32,000
34,000
4,000
160,000
38,000
150,000
152,000
$570,000
$ 54,000
25,000
11,000
200,000
25,000
120,000
83,000
$518,000
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$610,00
0
310,000
300,000
190,000
110,000
33,000
$ 77,000
The company declared and paid $8,000 in cash dividends during the year.
Required:
Construct in good form the operating activities section of the company's statement of
cash flows for the year using the direct method.
15-113
$610,00
0
-24,000
310,000
-18,000
+22,000
314,000
190,000
-8,000
-9,000
-48,000
125,000
33,000
+7,000
-13,000
15-114
$586,00
0
27,000
$120,00
0
$ 25
53
50
532
( 285)
$375
$ 22
48
56
430
( 261)
$295
$ 39
20
10
71
15
82
138
$375
$ 38
24
9
100
19
80
25
$295
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Gain on sale of plant and equipment..........
Income before taxes...................................
Income taxes..............................................
Net income.................................................
$954
606
348
162
186
10
196
59
$137
Cash dividends were $24. The company sold equipment for $10 that was originally
purchased for $4 and that had accumulated depreciation of $4.
Required:
Using the direct method, determine the net cash provided by (used by) operating
activities.
15-115
$954
( 5)
$949
Cost of sales..................................................
Decrease in inventory...................................
Increase in accounts payable.........................
606
(6)
( 1)
599
162
4
( 28)
138
Income taxes.................................................
Increase in taxes payable..............................
Decrease in deferred taxes............................
59
(1)
4
62
15-116
$150
AICPA FN: Measurement
$ 24
24
32
598
( 390)
$288
$ 22
25
37
580
( 366)
$298
$ 38
23
12
87
16
63
49
$288
$ 45
25
10
110
17
60
31
$298
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$606
396
210
174
36
11
$ 25
15-117
$606
1
$607
396
(5)
7
398
174
2
( 24)
152
Income taxes....................................................
Increase in taxes payable.................................
Decrease in deferred taxes...............................
11
(2)
1
10
15-118
$ 47
AICPA FN: Measurement
$ 43
25
67
392
( 237)
$290
$ 35
28
66
360
( 198)
$291
$ 31
198
74
( 13)
$290
$ 29
240
70
( 48)
$291
Income Statement
Sales...........................................................
Cost of goods sold......................................
Gross margin..............................................
Selling and administrative expense............
Net operating income.................................
Income taxes..............................................
Net income.................................................
$618
398
220
156
64
19
$ 45
15-119
$61
8
$62
1
398
1
( 2)
397
156
( 39)
117
Income taxes.................................................
19
$ 88
15-120
15-121