Consolidated Balance Sheets Consolidated Income Statement Supplementary informat
ID: 2339595 • Letter: C
Question
Consolidated Balance Sheets
Consolidated Income Statement
Supplementary information for 2020:
1. Sandpearl paid $50,000 in cash dividends. Post Ranch paid $60,000 in cash dividends.
2. Operating expenses include depreciation expense of $250,000 and goodwill impairment losses of $80,000.
4. Accumulated depreciation balances on December 31, 2020 and 2019 were $1,200,000 and $1,100,000, respectively.
5. Property, plant and equipment of $1,000,000 was purchased for cash.
Use a negative sign with answers to indicate a decrease/reduction in cash.
Cash from operating activities
Net Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
Add (subtract) items not affecting cash:
Depreciation expense
Goodwill impairment loss
Undistributed equity method income
Net Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
Changes in current assets and liabilities:
Net cash from operating activities
Cash from investing activities
Net Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
Sale of property, plant and equipment
Net cash used for investing activities
Cash from financing activities
Net Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
Dividends paid to controlling shareholders
Dividends paid to noncontrolling shareholders
Net cash from financing activities
Net increase in cash
Plus cash balance, January 1
Cash balance, December 31
Here are the consolidated financial statements of Post Ranch Resort and its 70 percent owned subsidiary, Sandpearl, for the year ended December 31, 2020, plus supplementary information. Comparative balance sheets are provided for 2019 and 2020.Consolidated Balance Sheets
Consolidated Income Statement
December 31 2020 2019 Sales and other income $250,000,000 Cash $150,000 $113,000 Cost of sales -170,000,000 Receivables 325,000 310,000 Operating expenses -79,800,000 Inventories 1,400,000 1,450,000 Consolidated net income 200,000 Equity method investments 200,000 192,000 Noncontrolling interest in net income -90,000 Property, plant and equipment, net 5,000,000 4,700,000 Net income to controlling interest $110,000 Goodwill 3,000,000 3,080,000 Total assets $10,075,000 $9,845,000 Current liabilities $450,000 $425,000 Long-term liabilities 8,200,000 8,120,000 Shareholders’ equity to Post Ranch 1,185,000 1,135,000 Noncontrolling interest in Sandpear 240,000 165,000 Total liabilities and equity $10,075,000 $9,845,000Supplementary information for 2020:
1. Sandpearl paid $50,000 in cash dividends. Post Ranch paid $60,000 in cash dividends.
2. Operating expenses include depreciation expense of $250,000 and goodwill impairment losses of $80,000.
3. Sales and other income includes $50,000 gain on sale of property, plant and equipment and $10,000 equity in net income from equity method investees. Cash dividends received from equity method investees were $2,000.4. Accumulated depreciation balances on December 31, 2020 and 2019 were $1,200,000 and $1,100,000, respectively.
5. Property, plant and equipment of $1,000,000 was purchased for cash.
Required Prepare Post Ranch’s consolidated statement of cash flows for 2020, in good form. Use the indirect approach to display cash from operating activities.Use a negative sign with answers to indicate a decrease/reduction in cash.
Post Ranch Resort and SubsidiaryConsolidated Statement of Cash Flows
For the year 2020
Cash from operating activities
Net Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
?????Add (subtract) items not affecting cash:
Depreciation expense
AnswerGoodwill impairment loss
AnswerUndistributed equity method income
AnswerNet Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
Answer AnswerChanges in current assets and liabilities:
Receivables Answer Inventories Answer Current liabilities Answer AnswerNet cash from operating activities
AnswerCash from investing activities
Net Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
AnswerSale of property, plant and equipment
AnswerNet cash used for investing activities
AnswerCash from financing activities
Net Income OR Acquisition of property, plant and equipment, OR consolidate net income, OR Gain on sale of property and plant and equipment, OR INcrease in long-term liabilities
AnswerDividends paid to controlling shareholders
AnswerDividends paid to noncontrolling shareholders
AnswerNet cash from financing activities
AnswerNet increase in cash
AnswerPlus cash balance, January 1
AnswerCash balance, December 31
Explanation / Answer
Post Ranch Resort and subsidiary Consolidated statement of cash flow for the year 2020 Cash flows from operating activites Consolidated net Income 200000 Depreication expense 250000 Goodwill impairment losses 80000 Gain on sale of property, plant and equipment -50000 Undistributed equity method income -8000 Changes in operating assets and Liabilities Increase in Accounts Receivable -15000 Decrease in Inventory 50000 Increase in current liabilities 25000 Net Cash flows from Operating Activities 532000 Cash flows from investing activities Purchase of property, plant and equipment -1000000 Sale of property, plant and equipment 500000 Cash dividends received from Equity method investee Net Cash flows from Investing activities -500000 Cash flows from financing activities Increase in long term liabilities 80000 Dividends paid to Post Ranch Resort (controlling)shareholders -60000 Sandpearl(Non controlling) shareholders -15000 Net Cash flows from Financing activities 5000 Net Cash Flows 37000 Cash at the Beginning of year 113000 Cash at the end of year 150000