Prepare a statement of cash flows

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Reference no: EM131853828

Problems: Financial data of Fancy Footwork Company for 2016 and 2015 are presented below.

FANCY FOOTWORK COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2016 AND 2015

	2016	2015
Cash	$260,000	$230,000
Receivables	$156,000	$120,000
Inventory	$180,000	$220,000
Plant assets	$160,000	$135,000
Accumulated depreciation	$(80,000)	$(76,000)
Long-term investments (held-to-maturity)	$80,000	$93,000
	$756,000	$722,000

Accounts payable	$ 135,000	$ 122,000
Accrued liabilities	$ 30,000	$33,100
Bonds payable	$ 135,000	$ 166,000
Common stock	$ 180,000	$165,000
Retained earnings	$ 276,000	$ 235,900
	$ 756,000	$722,000

FANCY FOOTWORK COMPANY
INCOME STATEMENT
For the year ended Dec 31, 2016
Sales	750000
Cost of Goods Sold	530000
Gross Margin	220000
Selling and administrative expenses	106000
Income from Operations	114000
Other revenues and gains
Gain on sale of investments	7000
Income before tax	121000
Income tax expense	48400
Net Income	72600

Additional information: During the year, $9000 of common stock was issued in exchange for plant assets. No plant assets were sold in 2015. Cash dividends were $32500.

Required: A) Prepare a statement of cash flows using the indirect method.

B) Prepare a statement of cash flows using the direct method. (Do not prepare a reconciliation schedule.)

Reference no: EM131853828

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