The following comparative balance sheets and other data are for Cellular Telephone Sales, Inc.:
Cellular Telephone Sales, Inc. Comparative balance sheets 2011 December 31 and 2010
|
Assets |
2011 |
2010 |
|
Cash |
$76,105 |
$51,000 |
|
Accounts receivable, net |
26,075 |
24,250 |
|
Merchandise inventory |
30,000 |
35,000 |
|
Supplies on hand |
1,750 |
2,550 |
|
Prepaid expenses |
1,400 |
1,200 |
|
Land |
1,80,000 |
1,42,500 |
|
Equipment |
2,70,000 |
3,00,000 |
|
Accumulated depreciation – equipment |
-75,000 |
-67,500 |
|
Total assets |
$510,330 |
$489,000 |
|
Liabilities and stockholders” equity |
||
|
Accounts payable |
$ 45,330 |
$ 76,300 |
|
Salaries payable |
4,000 |
2,000 |
|
Accrued liabilities payable |
2,000 |
8,250 |
|
Long-term note payable |
1,50,000 |
1,50,000 |
|
Common stock ($5 par) |
1,85,000 |
1,65,000 |
|
Paid-in capital in excess of par |
32,500 |
-0- |
|
Retained earnings |
91,500 |
87,450 |
|
Total liabilities and stockholders” equity |
$510,330 |
$489,000 |
Land was bought for USD 37,500 cash. The company intends to build a building on the land. Currently the company leases a building for its operations.
Equipment costing USD 50,000 with accumulated depreciation of USD 30,000 was sold for USD 23,500 (a gain of USD 3,500), and equipment costing USD 20,000 was purchased for cash.
Depreciation expense for the year was USD 37,500.
Common stock was issued for USD 52,500 cash.
Dividends declared and paid in 2011 totaled USD 32,950.
Net income was USD 37,000.
The company paid interest of USD 3,000 and income taxes of USD 17,000. Prepare a statement of cash flows under the indirect method. Also prepare any necessary supplemental schedule(s).