Jan-01 Dec-31

CASH 186,000.00 ?
AR 201,000.00 273,000.00
INVENTORY 258,000.00 234,000.00
AP 159,000.00 144,000.00

CURRENT PERIOD
SALES 2,394,000.00 2,322,000.00
COGS 1,749,000.00 1,725,000.00
OPEX 321,000.00
NET INCOME 324,000.00
ASSUME THAT THERE WERE NO OTHER TRANSACTIONS.
COMPUTE THE CASH BALANCE

CAPITAL MAINTENANCE APPROACH

A=L+E
JANUARY 1, 2020
ASSETS LIAB + EQUITY
CASH 186,000.00 159,000.00
AR 201,000.00
INVENTORY 258,000.00 486,000.00

645,000.00 645,000.00

DECEMBER 31, 2020

ASSETS LIAB + EQUITY
CASH 447,000.00 144,000.00
AR 273,000.00 486,000.00
INVENTORY 234,000.00 324,000.00

TOTAL ASSETS 954,000.00 954,000.00

 Effect DIRECT METHOD

72,000.00 Total Sales 2,394,000.00

-24,000.00 Credit Sales -72,000.00
-15,000.00 Cash Sales 2,322,000.00
Cash Purchase of Inventory -1,725,000.00
Payment of AP -15,000.00
Payment of Opex -321,000.00
Total Cash Inflow (Increase in Cash) 261,000.00
Cash, Beg 186,000.00
Cash, Ending 447,000.00

INDIRECT METHOD

Net Income 324,000.00

Increase in Current Assets -72,000.00
Decrease in Current Assets 24,000.00
AP Increase in Current Liab 0.00
Decrease in Current Liab -15,000.00
EQUITY Total Cash Inflow (Increase in Cash) 261,000.00
Cash, beg 186,000.00
Cash, Ending 447,000.00

AP
BEG. CAPITAL
NET INCOME
Cash 2,322,000.00
Sales 2,322,000.00

Accounts Receivable 72,000.00

Sales 72,000.00

Inventory 1,725,000.00
Cash 1,725,000.00

Accounts Payable 15,000.00

Cash 15,000.00

OPEX 321,000.00
Cash 321,000.00