A.) Prepare the Statement of Cash Flows for Franklin Heavy Equipment Company using the indirect method B.) Analyze by preparing a Summary Cash Analysis and by commenting as we did on homework.

Franklin Heavy Equipment Company

Income Statement

For the Year Ended December 31, 2017

(in thousands)

Revenues $9,000

Depreciation expense $ 650

Other operating expenses 7,100 7,750

Income before income taxes $1,250

Interest expense 440

Income tax expense 270

Net income $ 540

Franklin Heavy Equipment Company

Balance Sheet

December 31, 2017 and 2016

2017 2016 2017 2016

Assets: Liability & SE:

Cash $ 230 $ 480 A/P $ 370 $ 550

A/R 510 590 Taxes Payable 120 280

Inventories 980 960 LT debt 910 830

Plant & Equipment 3,140 2,150 Common Stock 1,100 1,350

Less: Acc. Depr. (1,520) (870) Retained Earnings 840 300

Total Assets $3,340 $3,310 Total Liab. & SE $3,340 $3,310