ACC201 -Principles of Accounting

TUTORIAL TEST 10
The Balance Sheet and Income Statement for Oceanami are shown below:

Comparative Balance Sheet

December 31
Assets 2021 2020
Cash $182,000 $187,000
Accounts receivable 83,000 95,000
Inventories 121,000 138,000
Prepaid rent 7,000 5,000
Long term investment 195,000 100,000
Land 230,000 260,000
Equipment 350,000 225,000
Accumulated depreciation, equipment (138,000) (100,000)
Totul assets $985,000 $910.000

Liabilities and Stockholders' Equity

Accounts payable $40,000 $58,000
Interest payable 1,000 2,000
Income tax payable 12,000 10,000
Notes payable 285,000 205,000
Common stock 350,000 350,000
Retained earnings 297,000 285,000
Total liabilities and stockholders' equity $985,000 $910,000

Income Statement
For the Year Ended December 31, 2021
Revenues (including gains) $2,804,000
Cost of goods sold $1,900,000
Depreciation expense 38,000
Interest expense 16,000
Income tax expense 63,000
Operating expenses 575,000 2,592,000
Net income $212,000

The following additional information relates to 2021:

a) Dividends were declared and paid in cash.
b) Sold Land for $34,000, originally cost $30,000.
c) Acquiring an equipment cost $80,000 by issuing a three-year notes.
d) Purchase additional long-term investment for $95,000.

Required:
Prepare the statement of cash flows for Oceanami Company for 2021 using the indirect
method.