Accounting 25th edition, Warren, Problem 16-2A

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Statement of Cash Flows-Indirect Method The comparative balance sheet of Lankau Enterprises Inc. at December 31, 2014 and 2013, is as follows: Dec. 31, 2014 Dec. 31, 2013 Assets Cash $ 219, 900 $ 269, 700 Accounts receivable (net) 336, 900 363, 000 Merchandise inventory 482, 400 448, 800 Prepaid expenses 20, 100 14, 400 Equipment 982, 500 805, 500 Accumulated depreciation-equipment (256, 200) (198, 300) $1, 785, 600 $1, 703, 100 Liabilities and Stockholders'Equity Accounts payable (merchandise creditors) $ 375, 300 $ 356, 400 Mortgage note payable 0 504, 000 Common stock, $25 par 411, 000 36, 000 Paid-in capital: Excess of issue price over par-common stock 705, 000 480, 000 Retained earnings 294, 300 326, 700 $1, 785, 600 $1, 703, 100 Additional data obtained from the income statement and from an examination of the accounts in the ledger for 2014 are as follows: Net income, $198, 000. Depreciation reported on the income statement, $125, 100. Equipment was purchased at a cost of $244, 200, and fully depreciated equipment costing $67, 200 was discarded, with no salvage realized. The mortgage note payable was not due until 2016, but the terms permitted earlier payment without penalty. 15, 000 shares of common stock were issued at $40 for cash. Cash dividends declared and paid, $230, 400