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 Assets Cash Accounts receivable Merchandise inventory Land Equipment Accumulated depreciation Total assets $54,520 $21,650 80,110 189,970 194,770 69,270 103,910 266,930 204,520 84,580 (65.410) (32,380) $599,860 $572,580 Liabilities and Shareholders' Equity Accounts payable Bank loan payable Common shares Retained earning:s Total liabilities and shareholders' equity $599,860 $40,420 $48,880 158,990 216,610 201,140 173,470 199.310 133,620 $572,580 Additional information: 1. Profit was $118,530 2. Sales were $978,990. 3. Cost of goods sold was $751,620. 4. 5. 6. 7. 8. 9. Operating expenses were $42,330, exclusive of depreciation expense. Depreciation expense was $33,030. Interest expense was $13,310. Income tax expense was $25,350. Land was sold at a gain of $5,180 No equipment was sold during the year. $57,620 of the bank loan was repaid during the year. Common shares were issued for $27,670. 10. 11