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    PR 16-4a

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    Ahmed Awais
    The comparative balance sheet shows Green Earth Lawn and Garden's assets and liabilities as of December 31, 2008 and 2009. Assets increased from $835,200 to $989,000 due primarily to increases in accounts receivable, inventories, land, and equipment. Liabilities increased from $835,200 to $989,900 mainly due to increases in accounts payable and common stock. The income statement for 2009 shows net income of $117,900 on $940,000 in sales.

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    PR 16-4a

    Uploaded by

    Ahmed Awais
    273 views2 pages
    The comparative balance sheet shows Green Earth Lawn and Garden's assets and liabilities as of December 31, 2008 and 2009. Assets increased from $835,200 to $989,000 due primarily to increases in accounts receivable, inventories, land, and equipment. Liabilities increased from $835,200 to $989,900 mainly due to increases in accounts payable and common stock. The income statement for 2009 shows net income of $117,900 on $940,000 in sales.

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    PR 16-4A

    Original Title

    PR 16-4A

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    The comparative balance sheet shows Green Earth Lawn and Garden's assets and liabilities as of December 31, 2008 and 2009. Assets increased from $835,200 to $989,000 due primarily to increases in accounts receivable, inventories, land, and equipment. Liabilities increased from $835,200 to $989,900 mainly due to increases in accounts payable and common stock. The income statement for 2009 shows net income of $117,900 on $940,000 in sales.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    273 views2 pages

    PR 16-4a

    Uploaded by

    Ahmed Awais
    The comparative balance sheet shows Green Earth Lawn and Garden's assets and liabilities as of December 31, 2008 and 2009. Assets increased from $835,200 to $989,000 due primarily to increases in accounts receivable, inventories, land, and equipment. Liabilities increased from $835,200 to $989,900 mainly due to increases in accounts payable and common stock. The income statement for 2009 shows net income of $117,900 on $940,000 in sales.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    The comparative balance sheet of Green Earth Lawn and Garden Inc.

    , for December
    31,2008 and 2009 as follows
    Dec 31,2009

    Dec 31,2008

    Cash

    $137,900

    $142,300

    Accounts receivable (net)

    206,800

    190,500

    Inventories

    290,500

    284,100

    Investments

    90,000

    Land

    200,000

    Equipment

    255,000

    205,000

    Assets

    Accumulated depreciation

    (103,000)
    $989,000

    (76,700)
    $835,200

    Liabilities and Stockholder Equity


    Accounts payable(merchandise creditors)

    $224,900

    Accrues expenses(operating expenses)


    16,500
    Dividends payable

    $201,400

    14,100
    21,000

    Common stock $1 par

    19,000

    10,000

    8,000

    Paid-in capital in excess of par-common stock200,000


    Retired earnings

    100,000

    519,900

    490,300

    $989,900

    $835,200

    The income statement for the year ended December 31,2009, is as follows.
    Sales

    $940,000

    Cost of merchandise

    489,300

    Gross Profit

    $450,700

    Operating Expenses:
    Depreciation expenses

    $23,600

    Other operating expenses


    Total Operating expenses
    Operating income

    278,900
    302,500
    $148,200

    Other income:
    Gain on sale of investments

    32,000

    Income before income tax

    $180,200

    Income tax expense

    62,300

    Net income

    $117,900

    The following additional information was taken from the records.


    a.
    b.
    c.
    d.
    e.

    Equipment and land were acquired for cash.


    There were no disposals of equipment during the year
    The investments were sold for $122,000 cash
    The common stock was issued for cash
    There were $88,300 debit to Retained Earnings for cash dividends declared

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

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