Reference no: EM132612676
SYCAMORE CORPORATION
Comparative Statements of Financial Position
December 31
2020 2019
Cash.................................................................................. $ 43,000 $ 24,000
Accounts receivable, net.......................................................... 35,000 38,000
Inventory................................................................................ 114,000 82,000
Land....................................................................................... 120,000 190,000
Building................................................................................. 200,000 200,000
Accumulated depreciation.................................................. (50,000) (40,000)
Equipment........................................................................... 1,030,000 600,000
Accumulated depreciation............................................... (118,000) (94,000)
.......................................................................................... $1,374,000 $1,000,000
Accounts payable (merchandise purchases only)............. $ 115,000 $ 100,000
Salaries payable....................................................................... 20,000 -0-
4% Bonds payable.................................................................. 300,000 -0-
Common shares...................................................................... 750,000 750,000
Retained earnings................................................................ 189,000 150,000
.......................................................................................... $1,374,000 $1,000,000
SYCAMORE CORPORATION
Income Statement
For year ended December 31, 2020
Sales.................................................................................. $ 1,075,000
Cost of goods sold................................................................... 640,000
Depreciation expense............................................................... 94,000
Salaries expense....................................................................... 140,000
Rent expense.............................................................................. 72,000
Other operating expenses, including bond interest.................... 14,000
Net loss on disposal of assets..................................................... 10,000
Income taxes expense................................................................ 21,000
Net income............................................................................. $ 84,000
Additional Data:
1. The bonds were sold at par on July 1, 2020.
2. Cash dividends were paid.
3. Land was sold for $80,000.
4. Old equipment was sold for $70,000.This equipment had cost $150,000 and had accumulated depreciation of $60,000 to date of sale. New equipment was purchased to replace it.
Instructions
Problem 1: Prepare statement of cash flows for calendar 2020, using the direct method.