Problem Four A comparative balance sheet for Roxanne Company is presented below:

Problem Four

A comparative balance sheet for Roxanne Company is presented below:

Comparative Balance Sheet

                                                                                      2017              2016

Assets

Cash                                                                       $ 39,000       $ 31,000

Accounts receivable (net)                                         80,000           60,000

Prepaid insurance                                                     22,000           17,000

Land                                                                           18,000           40,000

Equipment                                                                  70,000           60,000

Accumulated depreciation                                      (20,000)       (13,000)

      Total Assets                                                    $209,000       $195,000

Liabilities and Stockholders’ Equity

Accounts payable                                                  $ 11,000        $  6,000

Bonds payable                                                           27,000           19,000

Common stock                                                        140,000         115,000

Retained earnings                                                    31,000          55,000

      Total liabilities and stockholders’ equity        $209,000       $195,000

Additional information:

1.  Net loss for 2017 is $20,000.

2.  Land was sold for cash at a loss of $10,000. This was the only land transaction during the year.

3.  Equipment with a cost of $15,000 and accumulated depreciation of $10,000 was sold for $5,000 cash.

4.  $12,000 of bonds was retired during the year at carrying (book) value.

5.  Equipment was acquired for common stock. The fair market value of the stock at the time of the exchange was $25,000.

Instructions:

1. Prepare Operating Activities for SCF, using Indirect Method.

2. Using the data above prepared a correct form the classified balance sheet for 2017.