199. Use the following financial statements and additional informationto (1) prepare astatement of cash flows for the year ended December 31, 2015 using the indirect method, and (2) compute the company’s cash flow on total assets ratio for 2015. Derby Company Balance Sheets At December 31 2015 2014 Assets: Cash................................... $ 85,600 $ 65,200 Accounts receivable, net..................... 72,850 56,750 Merchandise inventory...................... 157,750 144,850 Prepaid expenses........................... 6,080 12,680 Equipment................................ 280,600 245,600 Accumulated depreciation-Equipment............ (80,600 ) (97,600 ) Total assets............................... $522,280 $427,480 Liabilities: Accounts payable.......................... $ 52,850 $ 45,450 Income taxes payable....................... 15,240 12,240 Notes payable (long term)...................... 59,200 79,200 Total liabilities............................. $127,290 $136,890 Equity: Common stock............................ 200,000 150,000 Paid-in capital in excess of par................... 53,000 40,000 Retained earnings.......................... 141,990 100,590 Total equity............................... $394,990 $290,590 Total liabilities and equity...................... $522,280 $427,480 Derby Company Income Statement For Year Ended December 31, 2015 Sales............................ $488,000 Cost of goods sold................... $212,540 Depreciation expense................ 43,000 Other operating expenses.............. 106,260 Interest expense.................... 6,400 (368,200 ) Other gains (losses): Gain on sale of equipment............. 4,700 Income before taxes................. 124,500 Income taxes expense................ 41,100 Net income....................... $83,400 Additional Information a. A $20,000 note payable is retired at its carrying value in exchange for cash.b. The only changes affecting retained earnings are net income and cash dividends paid.c. New equipment is acquired for $120,000 cash.d. Received cash for the sale of equipment that had cost $85,000, yielding a gain of $4,700.e. Prepaid expenses relate to Other Expenses on the income statement.f. All purchases and sales of merchandise inventory are on credit.

199. Use the following financial statements and additional informationto (1) prepare astatement of cash flows for the year ended December 31, 2015 using the indirect method, and (2) compute the...

199. Use the following financial statements and additional informationto (1) prepare astatement of cash flows for the year ended December 31, 2015 using the indirect method, and (2) compute the company’s cash flow on total assets ratio for 2015.

Derby Company Balance Sheets At December 31
	2015		2014
Assets:
Cash...................................	$ 85,600		$ 65,200
Accounts receivable, net.....................	72,850		56,750
Merchandise inventory......................	157,750		144,850
Prepaid expenses...........................	6,080		12,680
Equipment................................	280,600		245,600
Accumulated depreciation-Equipment............	(80,600	)	(97,600	)
Total assets...............................	$522,280		$427,480

Liabilities:
Accounts payable..........................	$ 52,850		$ 45,450
Income taxes payable.......................	15,240		12,240
Notes payable (long term)......................	59,200		79,200
Total liabilities.............................	$127,290		$136,890
Equity:
Common stock............................	200,000		150,000
Paid-in capital in excess of par...................	53,000		40,000
Retained earnings..........................	141,990		100,590
Total equity...............................	$394,990		$290,590
Total liabilities and equity......................	$522,280		$427,480

Derby Company Income Statement For Year Ended December 31, 2015
Sales............................		$488,000
Cost of goods sold...................	$212,540
Depreciation expense................	43,000
Other operating expenses..............	106,260
Interest expense....................	6,400	(368,200	)
Other gains (losses):
Gain on sale of equipment.............		4,700
Income before taxes.................		124,500
Income taxes expense................		41,100
Net income.......................		$83,400

Additional Information

a. A $20,000 note payable is retired at its carrying value in exchange for cash.
b. The only changes affecting retained earnings are net income and cash dividends paid.
c. New equipment is acquired for $120,000 cash.
d. Received cash for the sale of equipment that had cost $85,000, yielding a gain of $4,700.
e. Prepaid expenses relate to Other Expenses on the income statement.
f. All purchases and sales of merchandise inventory are on credit.

May 15, 2022

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199. Use the following financial statements and additional informationto (1) prepare astatement of cash flows for the year ended December 31, 2015 using the indirect method, and (2) compute the...

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