Instructions Prepare a statement of cash fl ows using the indirect method
Fundamentals Of Financial Management, Concise Edition (mindtap Course List)
10th Edition
ISBN:9781337902571
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Eugene F. Brigham, Joel F. Houston
Chapter3: Financial Statements, Cash Flow, And Taxes
Section: Chapter Questions
Problem 12P
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Question
Condensed fi nancial data of Minnie Hooper Company are shown below.
MINNIE HOOPER COMPANY
Comparative Balance Sheets
December 31
Assets 2012 2011
Cash $102,700 $ 33,400
Accounts receivable 60,800 37,000
Inventory 126,900 102,650
Investments 79,500 107,000
Plant assets 315,000 205,000
Accumulated depreciation (44,500) (40,000)
Total $640,400 $445,050
Liabilities and Stockholders’ Equity
Accounts payable $ 57,700 $ 48,280
Accrued expenses payable 15,100 18,830
Bonds payable 145,000 70,000
Common stock 250,000 200,000
Retained earnings 172,600 107,940
Total $640,400 $445,050
MINNIE HOOPER COMPANY
Income Statement
For the Year Ended December 31, 2012
Sales revenue $297,500
Gain on sale of plant assets 5,000
302,500
Less:
Cost of goods sold $99,460
Operating expenses, excluding
depreciation expense 19,670
Depreciation expense 30,500
Income taxes 37,270
Interest expense 2,940 189,840
Net income $112,660
Additional information:
1. New plant assets costing $146,000 were purchased for cash during the year.
2. Investments were sold at cost.
3. Plant assets costing $36,000 were sold for $15,000, resulting in a gain of $5,000.
4. A cash dividend of $48,000 was declared and paid during the year.
Instructions
Prepare a statement of cash fl ows using the indirect method
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