8. Award: 20.00 points FINCH COMPANY Statement of Cash Flows For the Year Ended December 31, Year 2 Cash flows from operating activities: Net income $ 21,215 Less: Increase/Decrease in current assets and current liabilities: Decrease in inventory The comparative balance sheets and income statements for Finch Company follow: Assets Cash Accounts receivable Inventory Equipment Balance Sheets As of December 31 Year 2 Year 1 $ 25,093 $ 2,884 2,432 6,242 Plus: Noncash charges 21,257 (9,953) 19,341 1,459 5,852 44,147 (18,263) 9,201 $ 45,280 Cash flows from investing activities: Accumulated depreciation-equipment Land Total assets $ 64,412 Liabilities and equity Accounts payable (inventory) $ 2,638 $ 4,261 Long-term debt 2,841 Common stock 6,493 10,500 Retained earnings Total liabilities and equity $ 21,215 24,300 34,633 24,026 0 $ 64,412 $ 45,280 Cash flows from financing activities: Income Statement For the Year Ended December 31, Year 2 Sales revenue Cost of goods sold Gross margin Depreciation expense Operating income Gain on sale of equipment Loss on disposal of land Net income $ 39,240 (15,553) 23,687 (3,112) 20,575 700 (60) $ 21,215 Additional Data 1. During Year 2, the company sold equipment for $18,778; it had originally cost $29,500. Accumulated depreciation on this equipment was $11,422 at the time of the sale. Also, the company purchased equipment for $6,610 cash. 2. The company sold land that had cost $3,660. This land was sold for $3,600, resulting in the recognition of a $60 loss. Also, common stock was issued in exchange for title to land that was valued at $13,800 at the time of exchange. 3. Paid dividends of $10,608. Required Prepare a statement of cash flows using the indirect method. (Amounts to be deducted and cash outflows should be indicated by a minus sign.) 0 21,215 Ending cash balance $ 21,215 Schedule of noncash investing and financing activities: References