Comparative balance sheets for Bayshore Industries, Inc. as of December 31 year 2 and year 1 are presented below. Prepare the cash from operations section of the statement of cash flows using the DIRECT method.Bayshore Industries, Inc.Balance SheetsDecember 31, Year 2 and Year 1Year 2 Year 1 ChangeAssetsCurrent assetsCash and cash equivalents $ 216,000 $ 144,000 $ 72,000Trade receivables net 3,434,000 1,971,000 1,463,000Inventory 810,000 216,000 594,000Prepaid expenses 18,000 — 18,000Total current assets 4,478,000 2,331,000 2,147,000Property and equipment 7,780,000 7,740,000 40,000Less: accumulated depreciation 576,000 455,000 121,000Property and equipment net 7,204,000 7,285,000 (81,000)Intangibles, less accumulated amortization of $14,400 year 2 and $7,200 year 121,60028,800(7,200)Total assets $ 11,703,600 $ 9,644,800 $ 2,058,800Liabilities and Stockholders EquityCurrent liabilitiesAccounts payable and accrued expenses $ 872,600 $ 396,800 $ 475,800Line of credit 108,000 90,000 18,000Current portion of long-term debt 29,000 27,000 2,000Total current liabilities 1,009,600 513,800 495,800Long-term debt 3,069,000 3,098,000 (29,000)Total liabilities 4,078,600 3,611,800 466,800Stockholders equityCommon stock 9,000 9,000 0Additional paid-in capital 5,400,000 5,400,000 0Retained earnings 2,216,000 624,000 1,592,000Total stockholders equity 7,625,000 6,033,000 1,592,000Total liabilities and stockholders equity $ 11,703,600 $ 9,644,800 $ 2,058,800Bayshore Industries, Inc.Statement of Income and Retained EarningsFor the year ended December 31, Year 2Net sales $ 19,800,000Cost of sales 9,000,000Gross profit on sales 10,800,000Operating expensesSelling expenses 3,600,000General and administrative expenses 4,050,000Other operating expenses 393,300Total operating expenses 8,043,300Operating income 2,756,700Other income and expensesGain/loss on property and equipment disposals 18,000Interest income 9,000Interest expense (252,000)Other income and expenses net (225,000)Income before income taxes 2,531,700Provision for income taxes 759,700Net income 1,772,000Retained earnings beginning 624,000Dividends paid 180,000Retained earnings ending $ 2,216,000Comparative balance sheets for Bayshore Industries, Inc. as of December 31 year 2 and year 1 are presented below. Prepare the cash from operations section of the statement of cash flows using the…
Comparative balance sheets for Bayshore Industries, Inc. as of December 31 year 2 and year 1 are presented below.
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