CASH FLOW QUESTION Q# 6- Cash Flow Statement: Presented below is information related to M/s R Company. Use to prepare a Statement of Cash Flow: Assets 2004 2003 Cash 54,000 37,000 Accounts Receivable 68,000 26,000 Inventories 54,000 -0- Prepaid Expenses 4,000 6,000 Land 45,000 70,000 Buildings 200,000 200,000 Accumulated Depreciation- building (21,000) (11,000) Equipment 193,000 68,000 Accumulated Depreciation-equipment (28,000) (10,000) Liabilities and Stockholders' Equity 2004 2003 Accounts payable 23,000 40,000 Accrued expense payable 10,000 -0- Bonds payable 110,000 150,000 Common Stock ($1 par) 220,000 60,000 Retained earnings 206,000 136,000 Income Statement for the year 2004: Sales Revenue $890,000 Cost of goods Sold 465,000 Operating Expense 221,000 Interest Expense 12,000 Loss on sale of equipment 2000 700,000 Income from operation 190,000 Income Tax expenses 65,000 125,000 Net Income Additional information: a. Operating expenses including depreciation expense of $ 33,000 and charges from prepaid expenses of 42,000. b. Land was sold at its book value for cash. c. Cash dividend of $ 55,000 were declared and paid in 2004. d. Interest expense of $ 12,000 was paid in cash. e. Equipment with a cost of $166,000 was purchased for cash. Equipment with a cost of $ 41,000 and a book value of $ 36,000 was sold for $34,000Cash. f. Bonds of $10,000 were redeemed at their book value for Cash; bonds of $ 30,000 were converted into common stock. g. Common stock ($ 1par) of $130,000 was issued for cash. h. Accounts payable pertain to merchandise supplies. Required: Prepare a Cash Flow Statement by Indirect Method with proper headings of Operating, Financing and Investing Activities. 11 Page TheA'z