1 Tom's Fence 2 3 Tom's Fence Inc. Balance Sheets 4 Tom's Fence Inc. Income Statements Assets Current year Prior year Change 5 Current year Cash $ 70,000 $ 48,000 $ 22,000 6 Revenue $ 220,000 Accounts receivable 60,000 50,000 10,000 7 Cost of goods sold 130,000 Inventory 72,000 80,000 (8,000) 8 Gross profit 90,000 Property, plant and equipment 80,000 20,000 60,000 9 Accumulated depr. (18,000) (4,000) (14,000) 10 Operating Expenses Property, plant and equipment, net 62,000 16,000 46,000 11 Salary Expense 37,000 Total assets $ 264,000 $ 194,000 $ 70,000 12 Depreciation Expense 14,000 13 General and Administrative Ex 15,000 14 Total operating expenses 66,000 Liabilities & Equity 15 Operating income 24,000 Accounts payable $ 70,000 $ 64,000 $ 6,000 16 Interest expense 6,000 Interest payable 2,000 6,000 $ (4,000) 17 Income before taxes 18,000 Loans payable 84,000 60,000 24,000 18 Tax expense Common Stock 60,000 22.000 38,000 19 Net income $ 14,000 Retained earnings 48,000 42,000 6,000 20 Total liabilities & stockholder's equity $ 264,000 $ 194,000 $ 70,000 21 22 23 Required: Prepare the statement of cash flows (all sections). Use the indirect method. 24 4,000