ACC311 Chapter 5 In-class exercises Easthoff, Incorporated provided the following balance sheets and income statement for the current year. Easthoff, Incorporated Balance Sheet At December 31 12/31/xx 1/1/xx $ 7000 8.500 2.300 1.700 5 19,500 $ 3.500 8.000 4,000 2,200 5 12700 $ 12.000 75,000 $ 87,000 $106,500 $ 24300 58.000 $ 82,300 $100.000 Current Assets Cash Accounts Receivable Merchandise Inventory Prepaid Expenses Total Current Assets Noncurrent Assets Investments Property. Plant, and Equipment - net Total Noncurrent Assets Total Assets Liabilities Current Liabilities Accounts Payable Accrued Expenses Income Taxes Payable Total Current Liabilities Noncurrent Liabilities Notes Payable Total Noncurrent Liabilities Total Liabilities $4,500 9,800 6,000 $ 20,300 $ 1.000 5.120 4,850 $ 10,970 $ 31,000 31,000 5 51,300 $ 42,630 42,630 $ 53,600 Stockholders' Equity Common Stock, 51 par value Additional Paid in Capital Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Equity $ 10,000 24,700 20,500 $ 9,000 20.000 17400 $ 55,200 $ 46,400 $106.500 $100,000 1 ACC311 Chapter 5 In-class exercises Easthoff, Incorporated Income Statement For the year ended December 31 Sales Cost of Goods Sold Gross Profit $80,085 48,051 32,034 Selling, General, and Administrative Expenses Depreciation Expense Total Operating Expenses Income Before Interest and Taxes 10,700 2.400 13,100 18,934 Interest Expense 14.000) Income Before Tax 14,934 17,334) Income Tax Expense Net Income $ 7,600 Required - Prepare a statement of cash flows for Easthoff using the Indirect method. Pay attention to the PPE change. PPE is stated at "net", which means that the current year's depreciation expense has reduced the 12/31 balance. See me if you want to check your *cash used to purchase equipment" number. The change in RE is due to net income and dividends. PPE= property.plant + equipment 2