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The income statement for Jones Company

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The income statement for Jones Company +Ex. 1 Condensed financial data of Drake Company appear below: DRAKE COMPANY Comparative Balance Sheet December 31 2014 2013 Assets Cash $ 41,000 $ 35,000 Accounts receivable 75,000 53,000 Inventories 120,000 132,000 Prepaid expenses 19,000 25,000 Investments 100,000 75,000 Plant assets 325,000 250,000 Accumulated depreciation (65,000) (60,000) Total $615,000 $510,000 Liabilities and Stockholders’ Equity Accounts payable $ 93,000 $ 75,000 Accrued expenses payable 29,000 24,000 Bonds payable 120,000 160,000 Common stock 275,000 170,000 Retained earnings 98,000 81,000 Total $615,000 $510,000 DRAKE COMPANY Income Statement For the Year Ended December 31, 4 Sales $450,000 Less: Cost of goods sold $300,000 Operating expenses (excluding depreciation) 60,000 Depreciation expense 17,000 Income taxes 20,000 Interest expense 18,000 Loss on sale of plant assets 3,000 418,000 Net income $ 32,000 Additional information: 1. New plant assets costing $100,000 were purchased for cash in 2014. 2. Old plant assets costing $25,000 were sold for $10,000 cash when book value was $13,000. 3. Bonds with a face value of $40,000 were converted into $40,000 of common stock. 4. A cash dividend of $15,000 was declared and paid during the year. 5. Accounts payable pertain to merchandise purchases. Instructions Prepare a statement of cash flows for the year using the direct method. aEx. 2 The income statement for Jones Company showed cost of goods sold of $80,000 and operating expenses of $65,000. The comparative balance sheets for the year show that inventory decreased $5,000, prepaid expenses increased $7,000, accounts payable increased $3,000, and accrued expenses payable decreased $5,000. Instructions Compute (a) cash payments to suppliers and (b) cash payments for operating expenses using the direct method. Business Management Assignment Help, Business Management Homework help, Business Management Study Help, Business Management Course Help

The income statement for Jones Company

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