Preparing a statement of cash flows. (Adapted from CPA examination.) Exhibit 1 3. 1 presents a comparative statement of financial position for Biddle Corporation

as of December 31, Year 1 and Year 2. Exhibit 13.1 1 presents an income statement for Year 2. Additional information follows:
(1) On February 2, Year 2, Biddle issued a 10 percent stock dividend to shareholders of record on January 15, Year 2. The market price per share of the common stock on February 2, Year 2, was $15.
(2) On March 1 , Year 2, Biddle issued 1,900 shares of common stock for land. The common stock and land had current market values of approximately $20,000 on March 1, Year 2.
(3) On April 15, Year 2, Biddle repurchased long-term bonds with a face and book value of $25,000. It reported the gain of $1 1,000 as an extraordinary item on the income statement.
(4) On June 30. Year 2, Biddle sold equipment costing $26,500, with a book value of $11,500, for $9,500 cash.

(5) On September 30. Year 2, Biddle declared and paid a $.04 per share cash dividend to shareholders of record on August 1 , Year 2.
(6) On October 10, Year 2, Biddle purchased land for $42,500 cash.
(7) Deferred income taxes represent timing differences relating to the use of different depreciation methods for income tax and financial statement reporting.

a. Prepare a T-account work sheet for the preparation of a statement of cash flows.

b. Prepare a formal statement of cash flows for Biddle Corporation for the year ended December 31. Year 2.

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ROTH COMPANY EXHIBIT 13.8 Balance Sheet (Problem 10) Dec. 31, Year 6 Mar. 31, Year 7 Cash Marketable Securities Accounts Receivable (net) Inventory $ 37,950 $131,100 24,000 10,200 36,480 73,980 46,635 72,885 Total Current Assets $145,065 $288,165 Land 60,000 28,050 Building 375,000 375,000 Equipment 122,250 Accumulated Depreciation (22,500) (24.375) Investment in 30-Percent-Owned Company (using equity method) 91,830 100,470 Other Assets 22,650 Total Assets Accounts Payable Dividend Payable. Income Taxes Payable Total Current Liabilities Other Liabilities $672,045 $ 31,830 - 22,650 $912,210 $ 25,995 12,000 51,924 $ 89,919 279,000 $ 31,830 279,000 Bonds Payable 71,550 169.275 Deferred Income Tax 765 1.269 Preferred Stock.. 45,000 - Common Stock 120.000 165,000 Unrealized Holding Loss on Marketable Securities. (750) (750) Retained Earnings. 124,650 208.497 Total Equities $672,045 $912,210