Reference no: EM131784279
The comparative statements of financial position of Mikos Inc. as at December 31, 2014 and 2015, and its statement of earnings for the year ended December 31, 2015, are presented below:
| MIKOS INC. |
| Comparative Statements of Financial Position |
| December 31 |
| |
2015 |
|
2014 |
|
| Assets |
|
|
|
|
|
|
| Cash |
$ |
12,700 |
|
$ |
20,700 |
|
| Short-term investments |
|
107,900 |
|
|
68,100 |
|
| Trade receivables |
|
86,500 |
|
|
40,800 |
|
| Inventories, at cost |
|
61,400 |
|
|
43,700 |
|
| Prepayments |
|
7,700 |
|
|
13,400 |
|
| Land |
|
59,800 |
|
|
88,500 |
|
| Property, plant, and equipment, net |
|
294,800 |
|
|
197,500 |
|
| Intangible assets |
|
27,700 |
|
|
35,400 |
|
| |
|
|
| |
$ |
658,500 |
|
$ |
508,100 |
|
| |
|
|
| Liabilities and Shareholders' Equity |
|
|
|
|
|
|
| Trade payables |
$ |
20,700 |
|
$ |
47,400 |
|
| Income tax payable |
|
13,400 |
|
|
4,700 |
|
| Accrued liabilities |
|
13,700 |
|
|
-0- |
|
| Long-term notes payable |
|
147,000 |
|
|
224,000 |
|
| Contributed capital |
|
274,000 |
|
|
78,500 |
|
| Retained earnings |
|
189,700 |
|
|
153,500 |
|
| |
|
|
| |
$ |
658,500 |
|
$ |
508,100 |
|
| |
|
|
| MIKOS INC. |
| Statement of Earnings |
| For the Year Ended December 31, 2015 |
| Sales |
|
|
$ |
961,000 |
| Cost of sales |
$ |
467,000 |
|
|
| Amortization expense-intangible assets |
|
7,700 |
|
|
| Depreciation expense-property, plant, and equipment |
|
36,700 |
|
|
| Operating expenses |
|
258,000 |
|
|
| Interest expense |
|
15,700 |
|
785,100 |
| |
| Earnings before income taxes |
|
|
|
175,900 |
| Income tax expense |
|
|
|
52,770 |
| |
|
|
| Net earnings |
|
|
$ |
123,130 |
Additional information is as follows:
a. Land was sold for cash at its carrying amount.
b. The short-term investments will mature in February 2016.
c. Cash dividends were declared and paid in 2015.
d. New equipment with a cost of $169,700 was purchased for cash, and old equipment was sold at its carrying amount.
e. Long-term notes of $28,500 were paid in cash, and notes of $48,500 were converted to shares.
Required:
1. Prepare a statement of cash flows for Mikos Inc. for the year ended December 31, 2015 by using the indirect method. (Negative amounts should be indicated with a minus sign.)