Question

III. Cash Flow Rajesh Ltd. Comparative Statements of Financial Position December 31 Assets 2020 2019 Equipment £ 60,000 £ 78,000 Accumulated depreciation—equipment (29,000) (24,000) Inventory 30,000 20,000 Accounts receivable 33,000 14,000 Cash 37,000 20,000 Total £131,000 £108,000 Equity and Liabilities Share capital—ordinary £ 18,000 £ 14,000 Retained earnings 50,000 38,000 Bonds payable 27,000 33,000 Accounts payable 29,000 15,000 Income taxes payable 7,000 8,000 Total £131,000 £108,000 Rajesh Ltd. Income Statement For the Year Ended December 31, 2020 Sales revenue £242,000 Cost of goods sold 175,000 Gross profit 67,000 Operating expenses 24,000 Income from operations 43,000 Interest expense 3,000 Income before income taxes 40,000 Income tax expense 8,000 Net income £ 32,000 Additional data: 1. Depreciation expense is £13,300. 2. Dividends declared and paid were £20,000. 3. During the year, equipment was sold for £9,700 cash. This equipment cost £18,000 originally and had accumulated depreciation of £8,300 at the time of sale.

          III. Cash Flow
Rajesh Ltd.
Comparative Statements of Financial Position
December 31
Assets 2020 2019
Equipment £ 60,000 £ 78,000
Accumulated depreciation—equipment (29,000) (24,000)
Inventory 30,000 20,000
Accounts receivable 33,000 14,000
Cash 37,000 20,000
Total £131,000 £108,000
Equity and Liabilities
Share capital—ordinary £ 18,000 £ 14,000
Retained earnings 50,000 38,000
Bonds payable 27,000 33,000
Accounts payable 29,000 15,000
Income taxes payable 7,000 8,000
Total £131,000 £108,000
Rajesh Ltd.
Income Statement
For the Year Ended December 31, 2020
Sales revenue £242,000
Cost of goods sold 175,000
Gross profit 67,000
Operating expenses 24,000
Income from operations 43,000
Interest expense 3,000
Income before income taxes 40,000
Income tax expense 8,000
Net income £ 32,000
Additional data:
1. Depreciation expense is £13,300.
2. Dividends declared and paid were £20,000.
3. During the year, equipment was sold for £9,700 cash. This equipment cost £18,000 originally and had accumulated depreciation of £8,300 at the time of sale.

III. Cash Flow
Rajesh Ltd.
Comparative Statements of Financial Position
December 31
Assets 2020 2019
Equipment £ 60,000 £ 78,000
Accumulated depreciation—equipment (29,000) (24,000)
Inventory 30,000 20,000
Accounts receivable 33,000 14,000
Cash 37,000 20,000
Total £131,000 £108,000
Equity and Liabilities
Share capital—ordinary £ 18,000 £ 14,000
Retained earnings 50,000 38,000
Bonds payable 27,000 33,000
Accounts payable 29,000 15,000
Income taxes payable 7,000 8,000
Total £131,000 £108,000
Rajesh Ltd.
Income Statement
For the Year Ended December 31, 2020
Sales revenue £242,000
Cost of goods sold 175,000
Gross profit 67,000
Operating expenses 24,000
Income from operations 43,000
Interest expense 3,000
Income before income taxes 40,000
Income tax expense 8,000
Net income £ 32,000
Additional data:
1. Depreciation expense is £13,300.
2. Dividends declared and paid were £20,000.
3. During the year, equipment was sold for £9,700 cash. This equipment cost £18,000 originally and had accumulated depreciation of £8,300 at the time of sale.

Added by Chad C.

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