Financial Statement Preparation - REVISEDStatements of Retained Earnings and Cash FlowThe Glass Factory, Inc. has just ended the 2012 production year. The balance sheet and income statement are presented below. Two of the four key financial statements remain to be prepared for the stockholders’ report.
Balance SheetGlass Factory, Inc.December 31, 2011 and 2012 XXXXXXXXXXAssetsCash $ 1,000 $ 500
Accounts receivable 5,000 4,500
Inventory 7,000 6,000
Gross fixed assets $20,000 $15,000
Accumulated depreciation 10,000 9,000
Net fixed assets $10,000 $ 6,000
Total assets $23,000 $17,000
Liabilities and stockholders’ equityAccounts payable $ 2,000 $ 1,500
Notes payable 3,000 2,500
Accruals XXXXXXXXXX
Long-term debt 10,000 6,000
Common stock at par XXXXXXXXXX
Paid-in capital in excess of par 5,500 5,500
Retained earnings 1, XXXXXXXXXX
Total liabilities and stockholders’ equity $23,000 $17,000
Income StatementGlass Factory, Inc.for the Year Ended December 31, 2012Sales $40,000
Cost of goods sold 21,000
Gross profits $10,000
Operating expenses 13,000
Operating profits $ 6,000
Interest expense 2,000
Net profits before taxes $ 4,000
Taxes (40%) 1,600
Net profits after taxes
$ 2,400Required:a. Calculate the number of cash dividends paid during 2012.
b. Calculate the depreciation expense incurred during 2012.
c. Prepare a statement of retained earnings for the year ended December 31, 2012.
d. Prepare the statement of cash flows for the year ended December 31, 2012.