(APPENDIX 11B) USING A SPREADSHEET TO PREPARE A STATEMENT OF CASH FLOWS Jane Bahr, a controller of Endicott & Thurston, prepared the following balance sheets at the end of 2009 and 2008:

Endicott & Thurston Associates Balance Sheets December 31, 2009 and 2008 ASSETS 2009 2008 Current assets:

Cash $ 2,000 $ 17,000 Accounts receivable 78,000 219,000 Prepaid rent 29,000 104,000 Total current assets $109,000 $340,000 Long-term investments 51,000 40,000 Property, plant, and equipment:

Equipment, computing $ 488,000 $ 362,000 Equipment, office furniture 400,000 365,000

$ 888,000 $ 727,000 Accumulated depreciation (366,000) (554,000)

Net property, plant, and equipment 522,000 173,000 Total assets $682,000 $553,000 LIABILITIES AND EQUITY Current liabilities:

Accounts payable $ 56,000 $ 58,000 Salaries payable 89,000 105,000 Total current liabilities $145,000 $163,000 Long-term liabilities:

Long-term notes payable 80,000 105,000 Bonds payable 140,000 0 Total liabilities $365,000 $268,000 Equity:

Common stock $ 225,000 $ 225,000 Retained earnings 92,000 60,000 Total equity 317,000 285,000 Total liabilities and equity $682,000 $553,000 Additional information:

a. Computing equipment with a cost of $250,000 and accumulated depreciation of

$230,000 was sold for $5,000. New computing equipment was purchased for

$376,000.

b. New office furniture was purchased at a cost of $35,000.

c. Depreciation expense for 2009 was $42,000.

d. Investments costing $20,000 were sold for cash at a loss of $2,000. Additional investments were purchased for $31,000 cash.

e. A $25,000 principal payment on the long-term note was made during 2009.

f. A portion of the cash needed to purchase computing equipment was secured by issuing bonds payable for $140,000 cash.

g. Net income was $70,000 and dividends were $38,000.

Required:

. Using a spreadsheet, prepare a statement of cash flows for 2009. Assume Endicott Thurston use the indirect method.

. Discuss whether Endicott & Thurston appear to have matched the timing of inflows and outflows of cash.