Current assets 2020 2019 Cash $1,250 $1,600 Short-term invest. 100 200 $1,350 $1,800 Liabilities Borrowings 600 1,000 Stockholders' equity Common stock 200 300 Retained earnings 550 500 750 800 $1,350 $1,800 Other information: The short-term investments are riskless

Current assets 2020 2019 Cash $1,250 $1,600 Short-term invest. 100 200 $1,350 $1,800 Liabilities Borrowings 600 1,000 Stockholders' equity Common stock 200 300 Retained earnings 550 500 750 800 $1,350 $1,800 Other information: The short-term investments are riskless

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter9: Long-term Liabilities

Section: Chapter Questions

Problem 103.4C

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Leverage Cook Corporation issued financial statements at December 31, 2019, that include the following information: Balance sheet at December 31,2019 Assets $8,000,000 Liabilities $1,200,000 Stockholders' equity (300,000 shares) $6,800,000 Income statement for 2019: Income from operations $1,200,000 Less: Interest expense (100,000) Income before taxes $1,100,000 Less: Income taxes expense (0,30) (330,000) Net income $ 770,000 The levels of assets, liabilities, stockholders' equity, and operating income have been stable in recent years; however, Cook Corporation is planning a 51,800,000 expansion program that will increase income from operations by $350,000 to $1,550,000, Cook is planning to sell 8.5% notes at par to finance the expansion. Required: What earnings per share does Cook report before the expansion?
CP 14-8 Assume the following income statement and balance sheet information: Service revenue (all cash) $175 Operating expenses Salaries (all cash) 85 Net income $90 2020 2019 Current assets Cash $1,250 $1,600 Short-term invest. 100 200 $1,350 $1,800 Borrowings 600 1,000 Stockholders' equity Common stock 200 300 Retained earnings 550 500 750 800 $1,350 $1,800 Other information: The short-term investments are riskless and will be converted to a known amount of cash in 60 days. Borrowings are non- current. No gain or loss occurred when common stock was repurchased. Required: 1. Calculate cash flow from operating activities. 2. Prepare the 2020 statement of changes in equity. 3. Calculate cash flow from financing activities. 4. (Appendix) Prepare a cash flow table. Show that cash effects net to a $450 outflow. Liabilities
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4 Balance Sheet At December 31, 2021 Assets Cash Accounts receivable Inventory Machinery (net) Franchise (net) 76,000 134,000 73,000 138,000 48,000 Total assets $ 469,000 Liabilities and Shareholders' Equity Вook Accounts payable 86,000 Allowance for uncollectible accounts 23,000 91,000 Hint Notes payable Bonds payable Shareholders' equity Print 128,000 141,000 erences Total liabilities and shareholders' equity $ 469,000 Additional Information: 1. Cash includes a $38,000 restricted amount to be used for repayment of the bonds payable in 2025. 2. The cost of the machinery is $226,000. 3. Accounts receivable includes a $38,000 notes receivable from a customer due in 2024. 4. The notes payable balance includes accrued interest of $23,000. Principal and interest are both due on February 1, 2022. 5. The company began operations in 2016. Net income less dividends since inception of the company totals $53,000. 6. 68,000 shares of no par common stock were issued in 2016. 100,000 shares are…
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