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




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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