recitaiton 9 practice file for case flow 501015
Aug 29, 2021 | Uncategorized
| Condensed financial data of Arma Inc. follow. |
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| ARMA INC. |
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| Comparative Balance Sheets |
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| Dec-31 |
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| Assets |
2011 |
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2010 |
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| Cash |
$90,800 |
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$48,400 |
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| Accounts receivable |
92,800 |
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33,000 |
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| Inventories |
112,500 |
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102,850 |
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| Prepaid expenses |
28,400 |
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26,000 |
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| Investments |
138,000 |
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114,000 |
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| Plant assets |
270,000 |
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242,500 |
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| Accumulated depreciation |
-50,000 |
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-52,000 |
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| Total |
$682,500 |
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$514,750 |
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| Liabilities and Stockholders’ Equity |
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| Accounts payable |
$112,000 |
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$67,300 |
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| Accrued expenses payable |
16,500 |
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17,000 |
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| Bonds payable |
1,10,000 |
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1,50,000 |
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| Common stock |
2,20,000 |
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1,75,000 |
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| Retained earnings |
2,24,000 |
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1,05,450 |
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| Total |
$682,500 |
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$514,750 |
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| ARMA INC. |
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| Income Statement |
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| For the Year Ended December 31, 2011 |
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| Sales |
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$392,780 |
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| Less: |
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| Cost of goods sold |
$135,460 |
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| Operating expenses, excluding depreciation |
12,410 |
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| Depreciation expense |
46,500 |
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| Income taxes |
27,280 |
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| Interest expense |
4,730 |
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| Loss on sale of plant assets |
7,500 |
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2,33,880 |
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| Net income |
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$158,900 |
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| Additional information: |
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| 1. New plant assets costing $85,000 were purchased for cash during the year. |
| 2. Old plant assets having an original cost of $57,500 were sold for $1,500 cash. |
| 3. Bonds matured and were paid off at face value for cash. |
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| 4. A cash dividend of $40,350 was declared and paid during the year. |
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| Complete the statement of cash flows using the indirect method. (List amounts from largest positive to smallest positive followed by most negative to least negative, e.g. 15, 14, 10, -17, -5, -1. If amount decreases cash flow, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) |