Extra-Ordinaire Co. sells a single product (Pulsa) exclusively through newspaper advertising. The comparative income statements and statements of financial position are for the past two years. EXTRA-ORDINAIRE CO. Comparative Income Statements For the Years Ended 31 December 2012 and 2013 Sales Less: Cost of goods sold 2012 $6,400,000 3,100,000 2013 $4,100,000 1,900,000 $2,200,000 Gross profit on sales $3,300,000 Less: Operating expenses (including depreciation of $280,000 in 2012 and $290,000 2,600,000 in 2013) Loss on sale of equity securities 0 2,500,000 40,000 Profit (loss) for the year $ 700,000 ($ 340,000) EXTRA-ORDINAIRE CO. Comparative Statements of Financial Position 31 December 2012 2013 Assets Cash and cash equivalents $ 220,000 $ 600,000 Equity securities 270,000 120,000 Accounts receivable 400,000 350,000 Inventory 1,200,000 1,280,000 Property, plant, and equipment (net of accumulated depreciation) 2,500,000 2,410,000 Totals $4,590,000 $4,760,000 Liabilities & Equity Accounts payable Accrued expenses payable Notes payable $ 500,000 160,000 2,350,000 $ 700,000 140,000 2,370,000 1,080,000 1,430,000 Share capital Retained earnings 500,000 120,000 Totals $4,590,000 $4,760,000 Additional Information The following information regarding the company's operations in 2013 is available from the company's accounting records: 1. Early in the year the company declared and paid a $40,000 cash dividend. 2. During the year equity securities costing $150,000 were sold for $110,000 cash, resulting in a $40,000 nonoperating loss. 3. The company purchased property, plant, and equipment for $200,000, paying $80,000 in cash and issuing a note payable for the $120,000 balance. 4. During the year the company repaid a $100,000 note payable, but incurred an additional $120,000 in long-term debt as described in 3. 5. The owners invested $350,000 cash in the business as a condition of the new loans described in paragraphs 3 and 4 Instructions a. Prepare a worksheet for a statement of cash flows. (Input all amounts as positive values. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.) Balance sheet effects: EXTRA-ORDINAIRE CO. Worksheet for a Statement of Cash Flows For the Years Ended 31 December 2013 Beginning Debit Balance Changes Credit Changes Ending Balance Assets Cash and cash equivalents Equity securities Accounts receivable Inventory Property, Plant and equipment (net of accumulated depreciation) Totals Liabilities & Equity Accounts payable Accrued expenses payable Notes payable Share capital Retained earnings Totals $ b. Prepare a formal statement of cash flows for 2013 by the indirect method. (Amounts to be deducted should be indicated with a minus sign. Omit the "$" sign in your response.) $ EXTRA-ORDINAIRE CO. Statement of Cash Flows For the Year Ended 31 December 2013 Cash flows from operating activities: (Click to select) (Click to select) (Click to select) (Click to select) (Click to select) FA Subtotal (Click to select) (Click to select) $ $ Net cash (Click to select) v operating activities GA GA Cash flows from investing activities: (Click to select) (Click to select) Net cash (Click to select) investing activities $ Cash flows from financing activities: (Click to select) (Click to select) (Click to select) Net cash (Click to select) v financing activities $ (Click to select) Cash and cash equivalents, 1 January 2013 Cash and cash equivalents, 31 Dec 2013 $