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Complete the cash flow statement worksheet (USING THE INDIRECT METHOD)

Also compute the amounts for the items listed in cells H6, H7 and H8. Enter the amounts in cells I6, I7 and I8.

H7 and H8 are amounts that must be disclosed at the bottom of a formal cash flow statement when using the

indirect method.

The comparative balance sheet information is found in cells A2-D26. The income statement and retained

earnings statement are given in cells K2 to O26. Use cells C4 to C52 to complete the worksheet. Cells C1 and

C56 are check cells. If these cells are not zero, there is an error. Cells A28 to D56 would be the information

that would appear on the company's 2014 cash flow statement. You do not need to prepare a formal statement.

I have entered the net income information to help get you started. Cell F3 shows the change in cash for the

year.

Other information:

1) The total depreciation expense consists of $13,000 on buildings and $20,000 on equipment.

2) Equipment that had a cost of $57,000 and a book value of $29,000 was sold for $21,000.

3) Included in the other operating expenses is Patent amortization expense of $6,000.

4) All changes in long-term notes payable, mortgage payable, common stock and treasury stock are the result

of cash transactions.

5) Any equipment that was purchased was purchased with cash..

	Ending		Beginning							2014 Income Statement
Cash	88,000		100,000		-12,000					Net Sales				1,113,000
Accounts Receivable (net)	295,000		282,000							Operating Expenses
Inventory	470,000		480,000							Cost of Goods Sold			798,000
Prepaid Rent	9,000		7,000				Cash paid for rent			Rent Expense			5,000
Land	200,000		182,000				Cash paid for taxes			Wages Expense			72,000
Buildings	450,000		450,000				Cash paid for interest			Other Operating Expenses			58,000
Accumulated Depreciation	-39,000		-26,000							Depreciation Expense			33,000
Equipment	374,000		307,000							Total Operating Expenses				966,000
										Operating Income				147,000
Accumulated Depreciation	-100,000		-108,000							Nonoperating Items
										Interest Expense			12,000
Patents	40,000		46,000							Loss on Sale of Equipment			8,000	20,000
Accounts Payable	-480,000		-476,000							Total Nonoperating Items
Wages Payable	-25,000		-32,000							Income before Income Taxes				127,000
Taxes Payable	-40,000		-28,000							Income Tax Expense
Notes Payable-Long-Term	-167,000		-120,000							Current			40,000
Mortgage Payable	-170,000		-194,000							Deferred			11,000
Deferred Taxes	-41,000		-30,000							Provision for Inocme Taxes				51,000
Common Stock	-690,000		-660,000							Net Income				76,000
Retained Earnings	-206,000	-76,000	-190,000							Retained Earnings 1/1/2014				190,000
										Cash Dividends				60,000
Treasury Stock (at cost)	32,000		10,000							Retained Earnings 12/31/2014				206,000
	0		0
Cash from Operating Activities			76,000
Net income		76,000
Cash from Investing Activities			0
Cash from Financing Activities			0
Net Change in Cash for the Year			76,000
		0

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