Solution-Prepare a statement of cash flows for jem company

Prepare a statement of cash flows for jem company

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Reference no: EM13553563

JEM Company's comparative balance sheets for 2002 and 2003 are provided.

	2003	2002
Assets
Cash and cash equivalents	$ 30,500	$ 10,000
Accounts receivable (net)	64,500	51,000
Inventory	100,000	115,000
Equipment.	55,000	30,000
Accumulated depreciation-equipment	(21,500)	(14,000)
Total assets	$228,500	$192,000
Liabilities and Stockholders' Equity
Accounts payable	$ 52,500	$ 46,000
Long-term notes payable.	70,000	50,000
Capital stock	60,000	60,000
Retained earnings	46,000	36,000
Total liabilities and stockholders' equity.	$228,500	$192,000

The following additional information is available:

a.Net income for the year 2003 (as reported on the income statement) was $50,000.

b.Dividends of $40,000 were declared and paid.

c.Equipment that cost $8,000 and had a book value of $1,000 was sold during the year for $2,500.

Required

Based on the information provided, prepare a statement of cash flows for JEM Company for the year ended December 31, 2003. Use the indirect method to report cash flows from operating activities.

Reference no: EM13553563

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Prepare a statement of cash flows for jem company

Reference no: EM13553563

Reference no: EM13553563

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