Question
Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year Assets Cash $ 23 $ 13
Comparative financial statements for Weaver Company follow:
Weaver Company Comparative Balance Sheet at December 31 | ||||||||
This Year | Last Year | |||||||
Assets | ||||||||
Cash | $ | 23 | $ | 13 | ||||
Accounts receivable | 294 | 229 | ||||||
Inventory | 159 | 196 | ||||||
Prepaid expenses | 9 | 5 | ||||||
Total current assets | 485 | 443 | ||||||
Property, plant, and equipment | 506 | 428 | ||||||
Less accumulated depreciation | (82 | ) | (70 | ) | ||||
Net property, plant, and equipment | 424 | 358 | ||||||
Long-term investments | 27 | 33 | ||||||
Total assets | $ | 936 | $ | 834 | ||||
Liabilities and Stockholders' Equity | ||||||||
Accounts payable | $ | 303 | $ | 226 | ||||
Accrued liabilities | 73 | 79 | ||||||
Income taxes payable | 73 | 64 | ||||||
Total current liabilities | 449 | 369 | ||||||
Bonds payable | 197 | 170 | ||||||
Total liabilities | 646 | 539 | ||||||
Common stock | 164 | 201 | ||||||
Retained earnings | 126 | 94 | ||||||
Total stockholders equity | 290 | 295 | ||||||
Total liabilities and stockholders' equity | $ | 936 | $ | 834 | ||||
Weaver Company Income Statement For This Year Ended December 31 | ||||||
Sales | $ | 755 | ||||
Cost of goods sold | 448 | |||||
Gross margin | 307 | |||||
Selling and administrative expenses | 219 | |||||
Net operating income | 88 | |||||
Nonoperating items: | ||||||
Gain on sale of investments | $ | 7 | ||||
Loss on sale of equipment | (2 | ) | 5 | |||
Income before taxes | 93 | |||||
Income taxes | 24 | |||||
Net income | $ | 69 | ||||
During this year, Weaver sold some equipment for $19 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $6 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $37 of its own stock. This year Weaver did not retire any bonds.
Required:
1. Using the indirect method, determine the net cash provided by/used in operating activities for this year. (List any deduction in cash and cash outflows as negative amounts.)
2. Using the information from Part 1, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. (List any deduction in cash and cash outflows as negative amounts.)
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