Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year Assets $ 11 710 200 $ 32 430 265 Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment 930 740 115 625 734 630 60 570 53 $1,357 Less accumulated depreciation Net property, plant, and equipment Long-term investments Total assets $1,554 Liabilities and Stockholders Equity Accounts payable Accrued liabilities Income taxes payable Total current liabilities Bonds payable Total liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 450 45 90 585 400 985 365 204 569 $ 315 60 83 458 330 788 500 69 569 $1,357 $1,554 Weaver Company Income Statement For This Year Ended December 31 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items: $930 515 415 207 208 Gain on sale of investments Loss on sale of equipment Income before taxes Income taxes Net income (4) _2 210 63 $147 During this year, Weaver sold some equipment for $15 that had cost $54 and on which there was accumulated depreciation of $35. In addition, the company sold long-term investments for $60 that had cost $54 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $135 of its own stock. This year Weaver did not retire any bonds. Required 1. Using the direct method, adjust the company's income statement for this year to a cash basis. 2. Using the information obtained in (1) above, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. Using the direct method, adjust the company's income statement for this year to a cash basis. (Adjustment amounts that are to be deducted should be indicated with a minus sign.) Weaver Company Direct Method of Determining the Net Cash flows from Operating activities Adjustments to a cash basis: Adjustments to a cash basis: Selling and administrative expenses Adjustments to a cash basis: Income taxes Adjustments to a cash basis: Using the information obtained in (1) above, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. (Cash outflows and amounts to be deducted should be indicated with a minus sign.) Weaver Company Statement of Cash Flows For This Year Ended December 31 Operating activities: Cash received from customers Less cash disbursements for Total cash disbursements Investing activities: Financing activities: Beginning cash and cash equivalents Ending cash and cash equivalents