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Audio City, Incorporated, is developing its annual financial statements at December 3 1 . The statements are complete except for the statement of cash flows.

Audio City, Incorporated, is developing its annual financial statements at December 31. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized below:
Current Year Previous Year
Balance Sheet at December 31
Cash $ 55,000 $ 60,600
Accounts Receivable 14,20019,000
Inventory 20,80019,000
Equipment 219,000148,000
Accumulated DepreciationEquipment (57,000)(43,000)
Total Assets $ 252,000 $ 203,600
Accounts Payable $ 7,800 $ 18,600
Salaries and Wages Payable 2,0001,000
Notes Payable (long-term)59,00073,000
Common Stock 96,00068,000
Retained Earnings 87,20043,000
Total Liabilities and Stockholders Equity $ 252,000 $ 203,600
Income Statement
Sales Revenue $ 194,000
Cost of Goods Sold 88,000
Other Expenses 57,000
Net Income $ 49,000
Additional Data:
Bought equipment for cash, $71,000.
Paid $14,000 on the long-term notes payable.
Issued new shares of stock for $28,000 cash.
Dividends of $4,800 were paid in cash.
Other expenses included depreciation, $14,000; salaries and wages, $19,000; taxes, $24,000.
Accounts Payable includes only inventory purchases made on credit. Because a liability relating to taxes does not exist, assume that they were fully paid in cash.
Required:
1. Prepare the statement of cash flows for the current year ended December 31 using the indirect method. (Amounts to be deducted should be indicated by a minus sign.)Audio City, Incorporated, is developing its annual financial statements at December 31. The statements are complete except for the
statement of cash flows. The completed comparative balance sheets and income statement are summarized below:
Additional Data:
a. Bought equipment for cash, $71,000.
b. Paid $14,000 on the long-term notes payable.
c. Issued new shares of stock for $28,000 cash.
d. Dividends of $4,800 were paid in cash.
e. Other expenses included depreciation, $14,000; salaries and wages, $19,000; taxes, $24,000.
f. Accounts Payable includes only inventory purchases made on credit. Because a liability relating to taxes does not exist, assume that
they were fully paid in cash.
Required:
Prepare the statement of cash flows for the current year ended December 31 using the indirect method. (Amounts to be deducted
should be indicated by a minus sign.)
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