Condensed financial data of Oakley Company appear below.
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OAKLEY COMPANY Comparative Balance Sheets December 31 |
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|
Assets |
2014 |
2013 |
|
Cash |
$ 82,700 |
$ 47,250 |
|
Accounts receivable |
90,800 |
57,000 |
|
Inventory |
126,900 |
102,650 |
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Investments |
84,500 |
87,000 |
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Equipment |
255,000 |
205,000 |
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Accumulated depreciation—buildings |
(49,500) |
(40,000) |
|
$590,400 |
$458,900 |
|
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Liabilities and Stockholders” Equity |
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Accounts payable |
$ 57,700 |
$ 48,280 |
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Accrued expenses payable |
12,100 |
18,830 |
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Bonds payable |
100,000 |
70,000 |
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Common stock |
250,000 |
200,000 |
|
Retained earnings |
170,600 |
121,790 |
|
$590,400 |
$458,900 |
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OAKLEY COMPANY Income Statement For the Year Ended December 31, 2014 |
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Sales revenue |
$297,500 |
|
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Gain on disposal of equipment |
8,750 |
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|
306,250 |
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Less: |
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Cost of goods sold |
$99,460 |
|
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Operating expenses (excluding depreciation expense) |
14,670 |
|
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Depreciation expense |
49,700 |
|
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Income tax expense |
7,270 |
|
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Interest expense |
2,940 |
174,040 |
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Net income |
$132,210 |
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Additional information:
- Equipment costing $97,000 was purchased for cash during the year.
- Investments were sold at cost.
- Equipment costing $47,000 was sold for $15,550, resulting in gain of $8,750.
- A cash dividend of $83,400 was declared and paid during the year.
Instructions
Prepare a worksheet for the statement of cash flows using the indirect method. Enter the reconciling items directly in the worksheet columns, using letters to cross-reference each entry.