A comparative balance sheet for Carter Fuel Injection Systems, Inc. appears below: Carter Fuel Injection Systems, Inc. Comparative Balance Sheet Dec. 31, 2020 Dec. 31, 2019 Assets Cash $ 34,000 $11,000 Accounts receivable 25,000 13,000 Inventory 18,000 17,000 Prepaid expenses 11,000 9,000 Long-term investments -0- 17,000 Equipment 55,000 33,000 Accumulated depreciation—equipment (20,000) (15,000) Total assets $123,000 $85,000 Liabilities and Stockholders' Equity Accounts payable $ 27,000 $ 7,000 Bonds payable 35,000 45,000 Common stock 31,000 23,000 Retained earnings 30,000 10,000 Total liabilities and stockholders' equity $123,000 $85,000 Additional information: 1. Net income for the year ending December 31, 2020 was $35,000. 2. Cash dividends of $15,000 were declared and paid during the year. 3. Long-term investments that had a cost of $17,000 were sold for $14,000. 4. No equipment was sold during 2020. HINT: depreciation expense must be determined. Notice in #4 it states no equipment was “sold” during 2020, therefore, focus on the change in “accumulated depreciation”. Instructions Prepare only the Cash Flow from Operating Activities” section.
A comparative balance sheet for Carter Fuel Injection Systems, Inc. appears below:
Carter Fuel Injection Systems, Inc.
Comparative Balance Sheet
Dec. 31, 2020 Dec. 31, 2019
Assets
Cash $ 34,000 $11,000
Accounts receivable 25,000 13,000
Inventory 18,000 17,000
Prepaid expenses 11,000 9,000
Long-term investments -0- 17,000
Equipment 55,000 33,000
Total assets $123,000 $85,000
Liabilities and
Accounts payable $ 27,000 $ 7,000
Bonds payable 35,000 45,000
Common stock 31,000 23,000
Retained earnings 30,000 10,000
Total liabilities and stockholders' equity $123,000 $85,000
Additional information:
1. Net income for the year ending December 31, 2020 was $35,000.
2. Cash dividends of $15,000 were declared and paid during the year.
3. Long-term investments that had a cost of $17,000 were sold for $14,000.
4. No equipment was sold during 2020.
HINT: depreciation expense must be determined. Notice in #4 it states no equipment was “sold”
during 2020, therefore, focus on the change in “accumulated depreciation”.
Instructions
Prepare only the Cash Flow from Operating Activities” section.
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