Comparative financial statements for Weaver Company follow:

Weaver Company Comparative Balance Sheet at December 31
	This Year			Last Year
Assets
Cash	$	13		$	29
Accounts receivable		650			400
Inventory		185			250
Prepaid expenses		6			4
Total current assets		854			683
Property, plant, and equipment		710			600
Less accumulated depreciation		100			90
Net property, plant, and equipment		610			510
Long-term investments		6			50
Total assets	$	1,470		$	1,243
Liabilities and Stockholders' Equity
Accounts payable	$	420		$	300
Accrued liabilities		70			80
Income taxes payable		87			80
Total current liabilities		577			460
Bonds payable		410			300
Total liabilities		987			760
Common stock		288			400
Retained earnings		195			83
Total stockholders equity		483			483
Total liabilities and stockholders' equity	$	1,470		$	1,243

Weaver Company Income Statement For This Year Ended December 31
Sales					$	900
Cost of goods sold						500
Gross margin						400
Selling and administrative expenses						203
Net operating income						197
Nonoperating items:
Gain on sale of investments	$	10
Loss on sale of equipment		(7	)			3
Income before taxes						200
Income taxes						60
Net income					$	140

During this year, Weaver sold some equipment for $12 that had cost $51 and on which there was accumulated depreciation of $32. In addition, the company sold long-term investments for $54 that had cost $44 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $112 of its own stock. This year Weaver did not retire any bonds.

Required:

1. Using the direct method, adjust the companys 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.

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: 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