The 2020 comparative balance sheet and 2020 income statement of Maple Group Ltd, have just been prepare and presented to the owners by the company’s Accountant. Upon close examination of the financial information received, it was discovered that some figures in the balance sheet were erroneously omitted due to an oversight by the accountant who is not available to fix the problem due to his unavoidable absence from work. In addition, the owners were concerned about the movement in the company’s cash and cash equivalent given that the balance sheet does not show or explain the reason or reasons why there was an increase or decrease in this area. The company uses the indirect method to prepare the statement of cash flows and it is expected that this should be able to provide the needed clarity required by the owners. Requirements: A. How can the owners use the cash flow information or what can the statement of cash flows helps the owners to do? B. Reconstruct the company’s comparative balance sheet for 2019/2020 and compute and show the missing figures to include the appropriate sign as a positive or negative figure. c. Prepare a complete statement of cash flows for 2020 using the indirect method using the information in line with your first name initial. Maple Group Ltd Comparative Balance Sheet December 31, 2020 and 2019 2020 2019 Increase/(Decrease) Assets Cash and cash equivalent 64,990 61,895 ? Accounts Receivable 95,100 88,500 ? Inventories 72,500 79,855 ? Fixed Assets, net ? ? ? Total Assets 442,590 395,800 46,790 Liabilities Accounts payable 45,000 58,350 ? Accrued liabilities ? ? ? Long-term notes payable 99,500 128,550 ? Stockholders' Equity: Common Stock 143,050 105,110 37,940 Retained earnings 43,540 24,290 19,250 Total liabilities and stockholders' equity 442,590 395,800 46,790 Maple Group Ltd Income Statement Year Ended December 31,2020 Revenues and gains: Sales revenue 499,000 Interest revenue 11,800 Total revenues and gains 510,800 Expenses Cost of goods sold 205,500 Depreciation expense 28,500 Other operating expense 126,000 Interest expense 24,300 Total expenses 384,300 Income before income taxes 126,500 Income tax expense 16,300 Net Income 110,200 Notes Acquisition of fixed asset during 2020 72,950 Sale proceed from sale of plant asset - Receipt for issuance of notes payable - Payment for note payable 29,050 Dividend paid 90,950 Book value of equipment sold - N.B Do not fill dash areas in notes section, use figures available.
The 2020 comparative balance sheet and 2020 income statement of Maple Group Ltd, have just been prepare and presented to the owners by the company’s Accountant. Upon close examination of the financial information received, it was discovered that some figures in the balance sheet were erroneously omitted due to an oversight by the accountant who is not available to fix the problem due to his unavoidable absence from work. In addition, the owners were concerned about the movement in the company’s cash and cash equivalent given that the balance sheet does not show or explain the reason or reasons why there was an increase or decrease in this area. The company uses the indirect method to prepare the statement of
Requirements:
A. How can the owners use the cash flow information or what can the statement of cash flows helps the owners to do?
B. Reconstruct the company’s comparative balance sheet for 2019/2020 and compute and show the missing figures to include the appropriate sign as a positive or negative figure.
c. Prepare a complete statement of cash flows for 2020 using the indirect method using the information in line with your first name initial.
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Maple Group Ltd |
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Comparative Balance Sheet |
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December 31, 2020 and 2019 |
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2020 |
2019 |
Increase/(Decrease) |
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Assets |
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Cash and cash equivalent |
64,990 |
61,895 |
? |
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Accounts Receivable |
95,100 |
88,500 |
? |
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Inventories |
72,500 |
79,855 |
? |
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Fixed Assets, net |
? |
? |
? |
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Total Assets |
442,590 |
395,800 |
46,790 |
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Liabilities |
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|
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Accounts payable |
45,000 |
58,350 |
? |
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Accrued liabilities |
? |
? |
? |
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Long-term notes payable |
99,500 |
128,550 |
? |
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|
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Common Stock |
143,050 |
105,110 |
37,940 |
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43,540 |
24,290 |
19,250 |
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Total liabilities and stockholders' equity |
442,590 |
395,800 |
46,790 |
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Maple Group Ltd |
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Income Statement |
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Year Ended December 31,2020 |
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Revenues and gains: |
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Sales revenue |
499,000 |
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Interest revenue |
11,800 |
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Total revenues and gains |
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510,800 |
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Expenses |
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Cost of goods sold |
205,500 |
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28,500 |
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Other operating expense |
126,000 |
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Interest expense |
24,300 |
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Total expenses |
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384,300 |
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Income before income taxes |
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126,500 |
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Income tax expense |
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16,300 |
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Net Income |
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110,200 |
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Notes |
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Acquisition of fixed asset during 2020 |
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72,950 |
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Sale proceed from sale of plant asset |
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- |
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Receipt for issuance of notes payable |
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- |
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Payment for note payable |
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29,050 |
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Dividend paid |
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90,950 |
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Book value of equipment sold |
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- |
N.B Do not fill dash areas in notes section, use figures available.
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