the income statement and statement of stockholders’ equity for Varney Corp
Question # 00437855
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Updated on: 12/07/2016 12:43 AM Due on: 12/07/2016
Attached are the income statement and statement of stockholders’ equity for Varney Corp for the year ended 12/31/2014 and the comparative balance sheet information at 12/31/2013 and 12/31/2014. The following additional information is provided:
- During 2014 Varney purchased land and a building through a $200,000 cash purchase. There were no disposals of operating assets during 2014. The building is the only depreciable operating asset that Varney owned during 2014
- During 2014, Varney issued 5,000 shares of its own common stock for $50,000
- During 2014, Varney repurchased 2,000 shares of its own common stock for $18,000
- The other operating expenses were paid in full during 2014
- During 2014, $2,000 of dividends were paid to stockholders
- An equity statement is not shown because all relevant information to the statement of cash flows has been provided
Required:
Prepare a statement of cash flows for Varney Corp. for the year ended 12/31/2014 using the “indirect” method of presenting operating cash flows.
Chapter 10 Homework Financial Statements
Varney Corp.
Income Statement
Year Ended 12/31/2014
Revenues and Gains:
Sales Revenue $1,118,000 Expenses and Losses:
Cost of Goods Sold
Salaries and Wages Expense
Rent Expense
Depreciation Expense
Other Operating Expenses
Interest Expense
Net Income $ 614.600
206,800
9,000
4,000
123,180
2,000 963,580
$ 158,420 Varney Corp.
Comparative Balance Sheet Information
12/31/2013 & 12/31/2014
Assets:
Cash
Accounts Receivable
Inventory
Prepaid Rent
Operating Assets (Net)
Total Assets
Liabilities and Stockholders’ Equity:
Accounts Payable
Salaries & Wages Payable
Interest Payable
Notes Payable
Paid-in Capital
Retained Earnings
Treasury Stock
Total Liabilities & Stockholders’ Equity 12/31/2013
$ 85,800
73,500
40,000
3,000
0
$202,300 12/31/2014
$136,900
115,520
15,400
0
196,000
$463,820 Change
$ +51,100
+42,020
- 24,600
-3,000
+196,000
$+261,520 $ 51,500
900
500
50,000
75,000
24,400
0
$202,300 $120,000
6,000
0
50,000
125,000
180,820
(18,000)
$463,820 $ +68,500
+ 5,100
500
0
+50,000
+156,420
-18,000
$+261,520
Varney Corp.
Income Statement
Year Ended 12/31/2014
Revenues and Gains:
Sales Revenue $1,118,000 Expenses and Losses:
Cost of Goods Sold
Salaries and Wages Expense
Rent Expense
Depreciation Expense
Other Operating Expenses
Interest Expense
Net Income $ 614.600
206,800
9,000
4,000
123,180
2,000 963,580
$ 158,420 Varney Corp.
Comparative Balance Sheet Information
12/31/2013 & 12/31/2014
Assets:
Cash
Accounts Receivable
Inventory
Prepaid Rent
Operating Assets (Net)
Total Assets
Liabilities and Stockholders’ Equity:
Accounts Payable
Salaries & Wages Payable
Interest Payable
Notes Payable
Paid-in Capital
Retained Earnings
Treasury Stock
Total Liabilities & Stockholders’ Equity 12/31/2013
$ 85,800
73,500
40,000
3,000
0
$202,300 12/31/2014
$136,900
115,520
15,400
0
196,000
$463,820 Change
$ +51,100
+42,020
- 24,600
-3,000
+196,000
$+261,520 $ 51,500
900
500
50,000
75,000
24,400
0
$202,300 $120,000
6,000
0
50,000
125,000
180,820
(18,000)
$463,820 $ +68,500
+ 5,100
500
0
+50,000
+156,420
-18,000
$+261,520
-
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Solution: the income statement and statement of stockholders’ equity for Varney Corp