Statement of Cash Flows (Direct Method) The Wolff Company's income statement and comparative balance sheets at December 31 of 2013 and 2012 are shown below: WOLFF COMPANY Income Statement For the Year Ended December 31, 2013 Sales Revenue $635.000 Cost of Goods Sold Wages Expense Insurance Expense Depreciation Expense $430,000 86.000 3.000 17,000 interest Experse 9.000 Income Tax Expense 29.000 579.000 Net income $56.000 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec. 31, 2012 Assets Cash $1,000 S5.000 Accounts Receivable 41,000 32.000 Inventory 90.000 60.000 Prepaid Insurance 5.000 7.000 Plant Assets 250.000 195.000 Accumulated Depreciation (68.000) (51.000) %24329.000 $248.000 Total Assets Liabilities and Stockholders Equity Accounts Payable 57.000 S10.000 Wages Payable Income Tax Payable 9.000 6.000 7.000 8,000 Bonds Payable Common Stock Retained Earming 130.000 75,000 90,000 90.000 36.000 59,000 Total Liabilities and Stockhoiders Equity $329.000 $248.000 Cash dividends of $29,000 were declared and paid during 2013. Plant assets were purchased for cash and bonds payable were issued for cash. Bond interest is paid semi-annually on June 30 and December 31. Accounts payable relate to merchandise purc Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the direct method. Compute free cash flow
Statement of Cash Flows (Direct Method) The Wolff Company's income statement and comparative balance sheets at December 31 of 2013 and 2012 are shown below: WOLFF COMPANY Income Statement For the Year Ended December 31, 2013 Sales Revenue $635.000 Cost of Goods Sold Wages Expense Insurance Expense Depreciation Expense $430,000 86.000 3.000 17,000 interest Experse 9.000 Income Tax Expense 29.000 579.000 Net income $56.000 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec. 31, 2012 Assets Cash $1,000 S5.000 Accounts Receivable 41,000 32.000 Inventory 90.000 60.000 Prepaid Insurance 5.000 7.000 Plant Assets 250.000 195.000 Accumulated Depreciation (68.000) (51.000) %24329.000 $248.000 Total Assets Liabilities and Stockholders Equity Accounts Payable 57.000 S10.000 Wages Payable Income Tax Payable 9.000 6.000 7.000 8,000 Bonds Payable Common Stock Retained Earming 130.000 75,000 90,000 90.000 36.000 59,000 Total Liabilities and Stockhoiders Equity $329.000 $248.000 Cash dividends of $29,000 were declared and paid during 2013. Plant assets were purchased for cash and bonds payable were issued for cash. Bond interest is paid semi-annually on June 30 and December 31. Accounts payable relate to merchandise purc Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the direct method. Compute free cash flow
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter12: The Statement Of Cash Flows
Section: Chapter Questions
Problem 12.7E
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