3 Questions

ACC/291 - 49133250 / Assignment: Week 5 Assignment

*Problem 12-10A

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Condensed financial data of Odgers Inc. follow.

ODGERS INC.

Comparative Balance Sheets

December 31

Assets

2014

2013

Cash

$ 97,768

$ 58,564

Accounts receivable

106,238

45,980

Inventory

136,125

124,449

Prepaid expenses

34,364

31,460

Long-term investments

166,980

131,890

Plant assets

344,850

293,425

Accumulated depreciation

(60,500 )

(62,920 )

Total

$825,825

$622,848

Liabilities and Stockholders’ Equity

Accounts payable

$ 123,420

$ 81,433

Accrued expenses payable

19,965

25,410

Bonds payable

133,100

176,660

Common stock

266,200

211,750

Retained earnings

283,140

127,595

Total

$825,825

$622,848

ODGERS INC.

Income Statement Data

For the Year Ended December 31, 2014

Sales revenue

$470,037

Less:

Cost of goods sold

$163,907

Operating expenses, excluding depreciation

15,016

Depreciation expense

56,265

Income taxes

33,009

Interest expense

5,723

Loss on disposal of plant assets

9,075

282,995

Net income

$ 187,042

Additional information:

1.

New plant assets costing $121,000 were purchased for cash during the year.

2.

Old plant assets having an original cost of $69,575 and accumulated depreciation of $58,685 were sold for

$1,815 cash.

3.

Bonds payable matured and were paid off at face value for cash.

4.

A cash dividend of $31,497 was declared and paid during the year.

Further analysis reveals that accounts payable pertain to merchandise creditors.

Prepare a statement of cash flows for Odgers Inc. using the direct method. (Show amounts that decrease

ODGERS INC.

Statement of Cash Flows

For the Year Ended December 31, 2014

Cash at Beginning of Period<br>

Cash Receipts from Customers

409,779$

Less Cash Payments:

To Suppliers

133,596$

For Operating Expenses

23,365

For Income Taxes

33,009

For Interest

5,723

409,779

Net Cash Provided by Operating Activities<br>

23,365

Cash Flows from Investing Activities

Sale of Plant Assets

Purchase of Investments

Purchase of Plant Assets

Net Cash used by Investing Activities<br>

Cash Flows from Financing Activities

Sale of Common Stock

Payment of Cash Dividends

Redemption of Bonds

Net Cash used by Financing Activities<br>

Net Increase in Cash<br>

Cash at Beginning of Period<br>

Cash at End of Period

$

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