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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 Cost of Goods Sold Wages Expense Insurance Expense Depreciation Expense Interest Expense Income Tax Expense Net Income $698,500 $473,000 94,600 8,800 18,700 9,900 31,900 636,900 $61,600 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec. 31, 2012 Assets Cash Accounts Receivable Inventory Prepaid Insurance Plant Assets Accumulated Depreciation $12,100 45,100 99,000 5,500 275,000 (74,800) $361,900 $5,500 35,200 66,000 7,700 214,500 (56,100) $272.800 Total Assets Liabilities and Stockholders' Equity Accounts Payable Wages Payable Income Tax Payable Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity $7,700 9,900 7,700 143,000 99,000 94,600 $361,900 $11,000 6,600 8,800 82,500 99,000 64.900 $272,800 Cash dividends of $31,900 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 purchases. Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the indirect method. c. Compute free cash flow. d. Compute the operating-cash-flow-to-current-liabilities ratio. e. Compute the operating-cash-flow-to-capital-expenditures ratio. a. Change in Cash during 2013 s

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 Cost of Goods Sold Wages Expense Insurance Expense Depreciation Expense Interest Expense Income Tax Expense Net Income $698,500 $473,000 94,600 8,800 18,700 9,900 31,900 636,900 $61,600 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec. 31, 2012 Assets Cash Accounts Receivable Inventory Prepaid Insurance Plant Assets Accumulated Depreciation $12,100 45,100 99,000 5,500 275,000 (74,800) $361,900 $5,500 35,200 66,000 7,700 214,500 (56,100) $272.800 Total Assets Liabilities and Stockholders' Equity Accounts Payable Wages Payable Income Tax Payable Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity $7,700 9,900 7,700 143,000 99,000 94,600 $361,900 $11,000 6,600 8,800 82,500 99,000 64.900 $272,800 Cash dividends of $31,900 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 purchases. Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the indirect method. c. Compute free cash flow. d. Compute the operating-cash-flow-to-current-liabilities ratio. e. Compute the operating-cash-flow-to-capital-expenditures ratio. a. Change in Cash during 2013 s

Financial Accounting: The Impact on Decision Makers
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 12.1P
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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 Cost of Goods Sold Wages Expense Insurance Expense Depreciation Expense Interest Expense Income Tax Expense Net Income $698,500 $473,000 94,600 8,800 18,700 9,900 31,900 636,900 $61,600 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec. 31, 2012 Assets Cash Accounts Receivable Inventory Prepaid Insurance Plant Assets Accumulated Depreciation $12,100 45,100 99,000 5,500 275,000 (74,800) $361,900 $5,500 35,200 66,000 7,700 214,500 (56,100) $272.800 Total Assets Liabilities and Stockholders' Equity Accounts Payable Wages Payable Income Tax Payable Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity $7,700 9,900 7,700 143,000 99,000 94,600 $361,900 $11,000 6,600 8,800 82,500 99,000 64.900 $272,800 Cash dividends of $31,900 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 purchases. Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the indirect method. c. Compute free cash flow. d. Compute the operating-cash-flow-to-current-liabilities ratio. e. Compute the operating-cash-flow-to-capital-expenditures ratio. a. Change in Cash during 2013 s
Transcribed Image Text: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 Cost of Goods Sold Wages Expense Insurance Expense Depreciation Expense Interest Expense Income Tax Expense Net Income $698,500 $473,000 94,600 8,800 18,700 9,900 31,900 636,900 $61,600 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec. 31, 2012 Assets Cash Accounts Receivable Inventory Prepaid Insurance Plant Assets Accumulated Depreciation $12,100 45,100 99,000 5,500 275,000 (74,800) $361,900 $5,500 35,200 66,000 7,700 214,500 (56,100) $272.800 Total Assets Liabilities and Stockholders' Equity Accounts Payable Wages Payable Income Tax Payable Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity $7,700 9,900 7,700 143,000 99,000 94,600 $361,900 $11,000 6,600 8,800 82,500 99,000 64.900 $272,800 Cash dividends of $31,900 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 purchases. Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the indirect method. c. Compute free cash flow. d. Compute the operating-cash-flow-to-current-liabilities ratio. e. Compute the operating-cash-flow-to-capital-expenditures ratio. a. Change in Cash during 2013 s
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