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Portable Luggage Company at December 31, 2008

Price: $3.50

The comparative balance sheet of Portable Luggage Company at December 31, 2008 and
2007, is as follows:

An examination of the income statement and the accounting records revealed the following
additional information applicable to 2008:
a. Net income, $204,800.
b. Depreciation expense reported on the income statement: buildings, $20,500; machinery
and equipment, $9,000.
c. Patent amortization reported on the income statement, $5,500.
d. A building was constructed for $230,000.
e. A mortgage note for $90,000 was issued for cash.
f. 4,000 shares of common stock were issued at $38.50 in exchange for the bonds payable.
g. Cash dividends declared, $52,000.

Prepare a statement of cash flows, using the indirect method of presenting cash flows from
operating activities.

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