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(8.) (Preparation of statement of cash flows] Prepare a statement of cash flows for year 2 using the balance sheet, income statement, and additional information
(8.) (Preparation of statement of cash flows] Prepare a statement of cash flows for year 2 using the balance sheet, income statement, and additional information provided for the IS Company. IS COMPANY Balance Sheet, at December 31 Year 1 Year 2 $101,000 70,000 $113,000 75,000 2 Cash Accounts receivable Less: Allowance for doubtful accounts Inventory Prepaid rent Property, plant, and equipment Accumulated depreciation Total assets Accounts payable, merchandise Accounts payable, services Rent payable Interest payable Long-term debt Common stock Retained earnings Total liabilities and equity 50,000 3,000 100,000 (30,000) $ ? $ 40,000 50,000 0 1,000 100,000 80,000 20,000 $291,000 60,000 0 110,000 (30,000) $ ? $ 20,000 40,000 6,000 1,000 120,000 90,000 50,000 $327,000 IS COMPANY Income statement, for Year Ended December 31 Year 2 Sales Bad-debt expense $ ? 2,000 $ ? 90,000 30,000 Cost of goods sold Operating expenses Rent expense Interest expense Depreciation expense Loss on disposal of property Net income 12,000 1.000 1,000 $ ? Additional information: 1. Newly acquired property cost $25,000. 2. Dividends declared were $12,000. 3. Bad-debt expense is calculated as 1% of sales
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