Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year $ 13 670 190 30 410 255 700 610 880 720 105 615 3 $1,498 570 51 $1,321 Assets Cash 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 $ 305 90 81 $ 430 75 88 593 370 963 368 167 535 $1,498 476 310 786 450 85 535 $1,321 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 SB Loss on sale of equipment Income before taxes Income taxes Net income (6) During this year, Weaver sold some equipment for $13 that had cost $52 and on which there was accumulated depreciation of $33. In addition, the company sold long-term investments for $56 that had cost $48 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $82 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. Required 1 Required 2 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: Required 1 Required 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. (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 Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year $ 13 670 190 30 410 255 700 610 880 720 105 615 3 $1,498 570 51 $1,321 Assets Cash 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 $ 305 90 81 $ 430 75 88 593 370 963 368 167 535 $1,498 476 310 786 450 85 535 $1,321 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 SB Loss on sale of equipment Income before taxes Income taxes Net income (6) During this year, Weaver sold some equipment for $13 that had cost $52 and on which there was accumulated depreciation of $33. In addition, the company sold long-term investments for $56 that had cost $48 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $82 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. Required 1 Required 2 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: Required 1 Required 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. (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