Reference no: EM13853802

Financial Statement Preparation - REVISED Statements of Retained Earnings and Cash Flow The Glass Factory, Inc. has just ended the 2012 production year. The balance sheet and income statement are presented below. Two of the four key financial statements remain to be prepared for the stockholders' report. Balance Sheet Glass Factory, Inc. December 31, 2011 and 2012 2012 2011 Assets Cash $ 1,000 $ 500 Accounts receivable 5,000 4,500 Inventory 7,000 6,000 Gross fixed assets $20,000 $15,000 Accumulated depreciation 10,000 9,000 Net fixed assets $10,000 $ 6,000 Total assets $23,000 $17,000 Liabilities and stockholders' equity Accounts payable $ 2,000 $ 1,500 Notes payable 3,000 2,500 Accruals 500 500 Long-term debt 10,000 6,000 Common stock at par 500 500 Paid-in capital in excess of par 5,500 5,500 Retained earnings 1,500 500 Total liabilities and stockholders' equity $23,000 $17,000 Income Statement Glass Factory, Inc. for the Year Ended December 31, 2012 Sales $40,000 Cost of goods sold 21,000 Gross profits $10,000 Operating expenses 13,000 Operating profits $ 6,000 Interest expense 2,000 Net profits before taxes $ 4,000 Taxes (40%) 1,600 Net profits after taxes $ 2,400

Required:

a. Calculate the amount of cash dividends paid during 2012.

b. Calculate the depreciation expense incurred during 2012.

c. Prepare a statement of retained earnings for the year ended December 31, 2012.

d. Prepare the statement of cash flows for the year ended December 31, 2012.