Prepare a statement of cash flows

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Reference no: EM131800080

Question - SCF-Indirect Method

Andrews Inc., a greeting card company, had the following statements prepared as of December 31, 2010.

ANDREWS INC. Comparative Balance Sheet as of December 31, 2010 and 2009


12/31/10

12/31/09

Cash

$  5,981

$  9,008

Accounts Receivable

62,124

48,810

Short-term investments (Available-for-sale)

34,834

18,083

Inventories

39,952

60,125

Prepaid rent

4,877

4,180

Printing equipment

153,030

129,250

Accumulated depr.-equipment

(34,899)

(24,875)

Copyrights

45,764

50,582

Total assets

$311,663

$295,163




Accounts payable

$ 45,834

$ 41,998

Income taxes payable

3,999

6,191

Wages payable

7,666

4,270

Short-term loans payable

8,016

9,931

Long-term loans payable

59,989

66,890

Common stock, $10 par

100,460

100,460

Contributed capital, common stock

29,870

29,870

Retained earnings

55,829

35,553

Total liabilities & equity

$311,663

$295,163

 

ANDREWS INC. Income Statement For the Year Ended  December 31, 2010

Sales


$337,397

Cost of goods sold


175,640

Gross Margin


161,757

Operating expenses


119,170

Operating income


42,587

Interest expense

$11,466


Gain on sale of equipment

1,743

9,723

Income before tax


32,864

Income tax expense


6,603

Net income


$ 26,261

Additional information:

1. Dividends in the amount of $5,985 were declared and paid during 2010.

2. Depreciation expense and amortization expense are included in operating expenses.

3. No unrealized gains or losses have occurred on the investments during the year.

4. Equipment that had a cost of $29,200 and was 70% depreciated was sold during 2010.

Instructions - Prepare a statement of cash flows using the indirect method.

Reference no: EM131800080

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