Shaw Company revealed the following information for the years 2009 and 2010:
Shaw Company
Income Statement
For the Year Ended December 31, 2010
Sales ..........$ 55,000
Cost of goods sold .......(20,000)
Depreciation expense .....(2,000)
Other expenses .......(13,000)
Net income ........$ 20,000

Required:
1. Calculate the change in cash flows that serves as the control figure for the statement of cash flows.
2. Prepare a schedule that provides operating cash flows for the year 2010 by using the indirectmethod.

Transcribed Image Text:

Shaw Company Comparative Balance Sheets December 31, 2009 and 2010 2009 2010 Assets Cash Accounts receivable 24,000 $ 7,400 5,000 160,000 16,000) 20,000 $200,400 $ 59,600 9,200 6,000 160,000 (20,000) 47,000 $261,800 Property, plant, and equipment Accumulated depreciation Land Total assets Liabilities and equity Accounts payable Mortgage payable Stockholders equity $ 8,600 10,000 40,000 211,800 $261,800 191,800 $200,400 Total liabilities and equity