Question

Following is a partially completed balance sheet for Hoeman Inc. at December 31, 2020, together with comparative data for the year ended December 31, 2019. From the statement of cash flows for the year ended December 31, 2020, you determine the following Net income for the year ended December 31, 2020, was $98,500. Dividends paid during the year ended December 31, 2020, were $65,500. .Accounts receivable decreased $13,500 during the year ended December 31, 2020. The cost of new buildings acquired during 2020 was $133,500. No buildings were disposed of during 2020. The land account was not affected by any transactions during the year, but the fair value of the land at December 31, 2020, was $182,500. Required: a. Complete the December 31, 2020, balance sheet. (Hint Long-term debt is the last number to compute to make the balance sheet balance) b. Prepare a statement of cash flows for the year ended December 31, 2020, using the indirect method. Complete this question by entering your answers in the tabs below. Required A Required B Complete the December 31, 2020, balance sheet. (Hint: Long-term debt is the last number to compute to make the balance sheet balance.) HOEMAN INC Comparative Balance Sheets At December 31, 2020 and 2019 2019 2020 Assets: Current assets: 54,500 47,000 Cash 148,500 Accounts receivable 184,500 168.500

Answer 1

Cash flow statement:

HOEMAN INC.
Statement of Cash flows
For the Year Ended December 31,2020
Cash flows from operating activities:
Net income	$98,500
Add(deduct) items not affecting cash:
Depreciation expense (126500-110500)	$16,000
Decrease in accounts receivable	$13,500
Decrease in inventory	$16,000
Decrease in accounts payable	($25,500)
Net cash provided by operating activities		$118,500
Cash flows from investing activities:
Cash paid to acquire new building	($133,500)
Net cash provided by investing activities		($133,500)
Cash flows from financing activities:
Payment of cash dividends on common stock	($65,500)
Long-term debt	$43,500
Cash received from issuance of common stock	$5,500
Issuance of notes payable	$39,000
Net cash provided by financing activities		$22,500
Net increase(decrease) in cash		$7,500
cash balance, January 1,2020		$47,000
Cash balance, December 31,2020		$54,500

Balance Sheet:

HOEMAN INC.
Comparative Balance sheet
For the Year Ended December 31,2020
	2020	2019
Assets:
Currenta assets:
Cash	$54,500	$47,000
Accounts receivable	$135,000	$148,500
Inventory	$168,500	$184,500
Total current assets	$358,000	$380,000
Land	$143,000	$143,000
Buildings	$405,500	$272,000
Less: Accumulated depreciation	($126,500)	($110,500)
Total land & buildings	$422,000	$304,500
Total assets	$780,000	$684,500
Liabilities:
Current liabilities
Accounts payable*	$165,000	$190,500
Note payable	$165,000	$126,000
Total current liabilities	$330,000	$316,500
Long-term debt	$187,500	$144,000
Stockholders' equity:
Common stock	$50,500	$45,000
Retained earnings	$212,000	$179,000
Total stockholders' equity	$262,500	$224,000
Total liabilities and stockholders' equity	$780,000	$684,500

Calculations:

Retained earnings
Beginning	$179,000
Net income	$98,500
Dividends	($65,500)
Ending	$212,000
Long-term debt
Total liabilities and stockholders' equity	$906,500
Total stockholders' equity	($262,500)
Total current liabilities	($330,000)
Long-term debt	$314,000