Investment Securities and the Statement of Cash Flows
Julie Company came into existence with a $2,000 cash investment by owners on January 1, 2008, and entered into the following transactions during 2008:
|
Sales |
$ 3,200 |
|
Cash expenses |
(2,700) |
|
Purchase of building on January 1 |
550 |
|
Purchase of trading securities |
500 |
|
Sale of trading securities (cost, $200) |
340 |
|
Purchase of available for sale securities |
300 |
|
Sale of available for sale securities (cost, $100) |
60 |
The following additional information is available:
|
Balance in accounts receivable on December 31 |
$190 |
|
Depreciation expense recognized for the year |
50 |
|
Market value of remaining trading securities on December 31 |
210 |
|
Market value of remaining available for sale securities on December 31 |
270 |
Instructions:
1. Prepare an income statement for 2008.
2. Prepare a complete statement of cash flows for 2008. Use the indirect method of reporting cash from operating activities.
3. Prepare a balance sheet as of December 31, 2008.