Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year bok $ 4 250 ences 10 200 150 420 Assets Cash and cash equivalents Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Long-term investments Total assets 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 $ 805 $ 743 $ 220 $ 200 50 72 300 $ 805 $ 743 S 700 400 231 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! Gain on sale of investments Loss on sale of equipment Income before taxes Income taxes Net income During this year, Weaver sold some equipment for $10 that had cost $31 and on which there was accumulated depreciation of $12. In addition, the company sold long-term investments for $14 that had cost $4 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $35 of its own stock. This year Weaver did not retire any bonds. Check 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: Cost of merchandise purchased Selling and administrative expenses Income taxes Total cash disbursements Net cash provided by operating activities Investing activities: Proceeds from sale of equipment Proceeds from sale of long-term investments Additions to property, plant and equipment Net cash provided by investing activities Financing activities: Issuance of bonds payable Cash dividends paid Cash received from customers Less cash disbursements for: Cost of merchandise purchased Selling and administrative expenses Income taxes Total cash disbursements Net cash provided by operating activities Investing activities: Proceeds from sale of equipment Proceeds from sale of long-term investments Additions to property, plant and equipment Net cash provided by investing activities Financing activities: Issuance of bonds payable Cash dividends paid Repurchase of common stock | Net cash used in financing activities Net increase in cash and cash equivalents Beginning cash and cash equivalents Ending cash and cash equivalents 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 Sales $ 700 Adjustments to a cash basis: Increase in accounts receivable (50) 400 Cost of goods sold Adjustments to a cash basis: Decrease in inventory Increase in accounts payable Selling and administrative expenses Adjustments to a cash basis: Increase in prepaid expenses Decrease in accrued liabilities Depreciation (40) Income taxes Adjustments to a cash basis: Increase in income taxes payable 12 Weaver Company Direct Method of Determining the Net Cash Flows from Operating Activities Sales Adjustments to a cash basis: Increase in accounts receivable (50) 700 400 Cost of goods sold Adjustments to a cash basis: Decrease in inventory Increase in accounts payable (50) (20) 330 [ 231|| Selling and administrative expenses Adjustments to a cash basis: Increase in prepaid expenses Decrease in accrued liabilities Depreciation 2 15 (40)|| 208 21 Income taxes Adjustments to a cash basis: Increase in income taxes payable (12 Net cash provided by operating activities