Exercise 13-12 (Indirect Method) The comparative unclassified statement of financial position for Puffy Ltd. follows PUFFY LTD. Statement of Financial Position December 31 2015 2014 Cash Accounts receivable Merchandise inventory Land Equipment Accumulated depreciation Total assets 53,200 24,540 70,830 188,460 194,100 70,960 101,100 260,770 204,210 75,150 (65,960)(30,090) $582,580 $564,690 Liabilities and Shareholders' Equity Accounts payable Bank loan payable Common shares Retained earnings Total liabilities and shareholders' equity $582,580 $564,690 $38,720 $46,850 140,240 210,260 202,740 173,250 200,880 134,330 Additional information 1. 2. 3. 4. S. 6. 7. 8. 9. 10. 11. Profit was $112,470 Sales were $976,170 Cost of goods sold was $750,950 Operating expenses were $42,410, exclusive of depreciation expense Depreciation expense was $35,870 Interest expense was $13,060 Income tax expense was $25,740 Land was sold at a gain of $4,330 No equipment was sold during the year $70,020 of the bank loan was repaid during the year Common shares were issued for $29,490. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a-sign e.g. -15,000 or in parenthesis eg. (15,000).) PUFFY LTD. Statement of Cash Method Year Ended December 31, 2015 Adjustments to reconcile profit to