Question: Refer to the information reported about Golden
Refer to the information reported about Golden Corporation in Problem 12-4A.
RequiredPrepare a complete statement of cash flows using a spreadsheet as in Exhibit 12A.1; report operating activities under the indirect method. Identify the debits and credits in the Analysis of Changes columns with letters that correspond to the following list of transactions and events.
a. Net income was $136,000.
b. Accounts receivable increased.
c. Merchandise inventory increased.
d. Accounts payable increased.
e. Income taxes payable increased.
f. Depreciation' data-toggle="tooltip" data-placement="top" title="Click to view definition...">Depreciation expense was $54,000.
g. Purchased equipment for $36,000 cash.
h. Issued 12,000 shares at $5 cash per share.
i. Declared and paid $89,000 of cash dividends.
In Problem 12-4A
Golden Corp., a merchandiser, recently completed its 2013 operations. For the year,
(1) all sales are credit sales,
(2) all credits to Accounts receivable reflect cash receipts from customers,
(3) all purchases of inventory are on credit,
(4) all debits to Accounts payable reflect cash payments for inventory,
(5) Other Expenses are all cash expenses, and
(6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. The company’s balance sheets and income statement follow.
Additional Information on Year 2013 Transactions
a. Purchased equipment for $36,000 cash.
b. Issued 12,000 shares of common stock for $5 cash per share.
c. Declared and paid $89,000 in cash dividends.
In Exhibit 12A.1
Transcribed Image Text:
GOLDEN CORPORATION Comparative Balance Sheets December 31, 2013 and 2012 2013 2012 Assets Cash. $ 164,000 $107,000 Accounts receivable 83,000 71,000 Merchandise inventory 601,000 526,000 Equipment.. 335,000 299,000 Accum. depreciation' data-toggle="tooltip" data-placement="top" title="Click to view definition...">depreciation-Equipment (158,000) (104,000) Total assets . $1,025,000 $899,000 Liabilities and Equity' data-toggle="tooltip" data-placement="top" title="Click to view definition...">Equity Accounts payable %24 87,000 $ 71,000 Income taxes payable 28,000 25,000 Common stock, $2 par value 592,000 568,000 Paid-in capital in excess of par value, common stock. 196,000 160,000 Retained earnings .... 122,000 75,000 Total liabilities and equity $1,025,000 $899,000 GOLDEN CORPORATION Income Statement For Year Ended December 31, 2013 Sales .... $1,792,000 Cost of goods sold 1,086,000 Gross profit .. 706,000 Operating expenses depreciation expense Other expenses.. $ 54,000 494,000 548,000 Income before taxes 158,000 Income taxes expense 22,000 Net income $ 1 36,000 GENESIS Spreadsheet for Statement of Cash Flows-Indirect Method For Year Ended December 31, 2013 Analysis of Changes Dec. 31, 2012 Dec. 31, Debit Credit 2013 Balance Sheet-Debit Bal. Accounts $ 12,000 40,000 ) $ 20,000 70,000 ) 4,000 Cash $ 17,000 60,000 84,000 6,000 250,000 $417,000 Accounts receivable Merchandise invantory Prepaid expenses Plant assets 14,000 2,000 70,000 A $ 30,000 210,000 ) $336,000 14 Balance Sheet-Credit Bal. Accounts $ 48,000 40,000 12,000 N 5,000 24,000 $ 60.000 35.000 Accumulated depreciation Accounts payable Interest payable Income taxes payable Notes payable Common stock, $5 par value Retained eamings 4,000 0 12,000 1,000 2.000 22,000 10,000 60,000 64,000 O 34,000 A 90,000 15,000 38,000 ఆ,000 95,000 88,000 m) 6336,000 112.000 $417.000 23 14,000 A Statement of Cash Flows Operating activities Net income 38,000 Increase in accounts receivable 20,000 Increase in merchandise inventory Increase in prepaid expenses Decrease in accounts payable Decrease in interest payable Increase in income tawes payable depreciation expense Loss on sale of plant assets 14,000 2,000 5,000 1,000 32 10,000 24,000 6.000 bs Gain on retirement of notes 16,000 Investing activities Racepts from sale of plant assets Paymant tor purchase of plart assets Financing activties Paymant so resre notes Rocepts from issung stock Paymert of cash dividends 12,000 at) 10,000 18,000 15,000 14,000 Noncash Investing and Financing Activities Purchase of plant assets with notes 2) 60,000 at) 60,000 $337,000 $337.000
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