Use the given data for abc music co to make a statement of

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Reference no: EM13451856

Use the following data for ABC Music Co. to prepare a statement of cash flows using the indirect method for the year ended June 30, 2016.

ABC Music Co.
Income Statement
For the Year Ended June 30, 2016

Net Sales		$350,000
Less Expenses
Cost of Goods Sold	$200,000
Depreciation Expense	20,000
Administrative Expenses	52,000
Selling Expenses	45,000
Loss on Sale of Investment	500
Total Expenses		317,500
Net Income		$ 32,500

ABC Music Co.
Comparative Balance Sheets
June 30 2016 and 2015
Assets	2016	2015
Cash	$ 4,500	$ 15,000
Accounts Receivable (net)	35,000	27,500
Inventory	40,000	50,000
Prepaid Expenses	3,000	2,500
Long Term Investments	20,000	25,000
Plant and Equipment	80,000	40,000
Accumulated Depreciation	(20,000)	(12,000)
Total Assets	$162,500	$148,000

Liabilities
Accounts Payable	$ 2,000	$ 6,000
Wages Payable	220	260
Taxes Payable	780	740
Notes Payable	20,000	12,000
Total Liabilities	$23,000	$ 19,000

Stockholders' Equity
Common Stock	$ 65,000	$ 65,000
Retained Earnings	81,500	64,000
Total Paid in Capital and Retained Earnings	146,500	129,000
Less: Treasury Stock	( 7,000)	0
Total Stockholders' Equity	$139,500	$129,000
Total Liabilities and Stockholders' Equity	$162,500	$148,000

Additional Information:

A plant asset costing $20,000 was sold for its book value of $8,000. And additional plant asset was purchased for $60,000.
A long term investment was sold for $4,500.
The outstanding notes are long term. An $8,000 note was issued during 2016.
Common stock was repurchased.

Reference no: EM13451856

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