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##### Problem 12-3_Problem 12-4_Statement of Cash Flows

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Question;Problem 12-3 Statement;of Cash Flows (Direct Method);Peoria Corp. just;completed another successful year, as indicated by the following income statement;For;the Year Ended;December;31, 2012;Sales revenue \$1,250,000;Cost of goods sold;700,000;Gross profit \$ 550,000;Operating expenses 150,000;Income before interest;and taxes \$ 400,000;Interest expense 25,000;Income before taxes \$ 375,000;Income tax expense 150,000;Net income \$ 225,000;Presented here are;comparative balance sheets;December 31 2012 2011;Cash \$;52,000 \$ 90,000;Accounts receivable 180,000 130,000;Inventory 230,000 200,000;Prepayments 15,000 25,000;Total current assets \$ 477,000 \$ 445,000;Land \$;750,000 \$ 600,000;Plant and equipment 700,000 500,000;Accumulated;depreciation (250,000);(200,000);Total long-term assets \$1,200,000 \$;900,000;Total assets \$1,677,000;\$1,345,000;Accounts payable \$ 130,000 \$ 148,000;Other accrued;liabilities 68,000 63,000;Income taxes payable 90,000;110,000;Total current;liabilities \$ 288,000 \$ 321,000;Long-term bank loan;payable \$ 350,000 \$;300,000;Common stock \$;550,000 \$ 400,000;Retained earnings 489,000 324,000;Total stockholders;equity \$1,039,000 \$;724,000;Total liabilities and;stockholders equity \$1,677,000 \$1,345,000;Other information is as;follows;a. Dividends of \$60,000;were declared and paid during the year.;b. Operating expenses;include \$50,000 of depreciation.;c. Land and plant and;equipment were acquired for cash, and additional stock was issued for cash.;Cash also was received from additional bank loans.;Required;Prepare statement of;cash flows for 2012 usingdirect methodin the operating activities section;Problem 12-4 Statement;of Cash Flows Indirect Method;Refer to all of the;facts in Problem 12-3.;Required;Prepare a statement of;cash flows for 2012 using theindirect methodin the Operating Activities section.

Paper#37390 | Written in 18-Jul-2015

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