[Janelle101]

Can anyone please help me with the working for the unanswered questions and correct me with the answers I did get? :o

Selected Balance Sheet Data... 2008... 2007
Cash.. . 113,525
Acct. Receivables... 36,000... 42,000
Inventories... 28,000... 25,000
Acct. Payable... 31,000... 35,000
Salaries Payable... 2,000... 1,000
Equipment.. . 60,000... 40,000
Accum. Depreciation... 12,000... 16,000
Bonds Payable... 50,000... 100,000
Common Stock... 150,000... 100,000
Retained Earnings... 38,000... 20,000

Income Statement Data... 2008
Net Sales... 420,000
Cost of Goods Sold... 300,000
Salaries Expense... 84,000
Net Income... 30,000
Gain on Sales of Equipment... 2,000
(included in Net Income above)


Additional Information:
1. Equipment with a cost of $15,000 and a book value of $3,000 was sold for $5,000 during 2008.
2. Common stock was issued to retire bonds payable during 2008.
3. The only items affecting retained earnings in 2008 were net income and dividends declared and paid.

Questions
1. What amount of cash was collected from customers during 2008?
My answer - $426,000

2. What amount was paid for purchase of merchadise during 2008?
My answer - $303,000

3. What amount was paid for salaries expense during 2008?
my answer - $83,000

4. What amount was paid to acquire equipment during 2008?
My answer - I have problems with this working.

5. What amount was recorded as depreciation expense during 2008?
My answer - I have problem with this working.

6. What amount was declared and paid for dividends during 2008?
My answer - I have problem with this working.

7. What amount was paid to retire bonds payable during 2008?
My answer - $0

8. If the Indirect method is used to prepare the statement of cash flows, how much net cash was used for or provided by operating activities?
My answer - I have problem with this working.

9. What is the cash balance at December 31, 2008?
My answer - I have problem with this working.

[morgaine300]

1. What amount of cash was collected from customers during 2008?
My answer - $426,000

Correct.

2. What amount was paid for purchase of merchadise during 2008?
My answer - $303,000

You didn't adjust for the accounts payable.

3. What amount was paid for salaries expense during 2008?
my answer - $83,000

Correct.

4. What amount was paid to acquire equipment during 2008?
My answer - I have problems with this working.

Keep in mind:
Beginning Balance
+Purchases
-Sales (at cost)
= Ending Balance

Plug in what you know and work backwards towards what you don't know. (And then plug in your answer and work forwards to double check that you end up the right place.)

5. What amount was recorded as depreciation expense during 2008?
My answer - I have problem with this working.

OK, that's a bit trickier. First go back to the concept I used for the equipment account. (You can do this with any account.)

Beginning Accumulated
+Current Year Expense
- Depreciation that goes with anything sold
= Ending Accumulated

First you need to figure out what the depreciation was for the equipment sold. Do you remember where book value comes from? You can get it from that.

6. What amount was declared and paid for dividends during 2008?
My answer - I have problem with this working.

First, declared and paid will be the same because you have no Dividends Payable. Again, use the same technique I did in the other accounts. What account does dividends affect? Think about that first, and then use the beginning+additions-subtractions=ending thing. If you can come up with something, tell me what it is and I'll guide from there, but see what you can think up on this one.

7. What amount was paid to retire bonds payable during 2008?
My answer - $0

Correct. Good job - traded for stock.

8. If the Indirect method is used to prepare the statement of cash flows, how much net cash was used for or provided by operating activities?
My answer - I have problem with this working.

That is basically an entire topic unto itself. The indirect method is not what you've been using here to answer these questions. (Except for a couple of things.) You're really going to have to deal with this in a separate post. Have you tried working any of this out at all? If so, post what you have. (You can post it in this thread, but make it a separate post to make it easier to follow.)

9. What is the cash balance at December 31, 2008?
My answer - I have problem with this working.

You'll need to have (8) done first. They made this more difficult by not giving you a check figure. In real life, we use those cash balances to check if our cash flow came out right, not the other way around.

[Janelle101]

I understand thanks