Golden Corporation's current year income statement, comparative balance sheets, and additional information follow. For the year. (1) all sales are credit sales. (2) all credits to Accounts Receivable reflect cash receipts from customers. (3) all purchases of inventory are on credit. (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. GOLDEN CORPORATION Comparative Balance Sheets December 31 Current Year Prior Year Assets Cash $ 169,000 $ 112,500 Accounts receivable 98,5ee 76, ees Inventory 608,500 531, eee Total current assets 868,888 719, see Equipment 348,488 384, eee Accumulated depreciation-Equipment (168,580) (186,5ee) Total assets $ 1,855,988 $917, eee Liabilities and Equity Accounts payable $ 97,080 $ 76,800 Income taxes payable 33.000 27,6ee Total current liabilities 138,888 183,688 Equity Common stock, $2 par value 598,888 573, eee Paid-in capital in excess of par value, common stock 205,000 167,5ee Retained earnings 122,980 72,900 Total liabilities and equity $ 1,855,90 $ 917, eee GOLDEN CORPORATION Income Statement For Current Year Ended December 31 Sales $ 1,817, eee Cost of goods sold 1,891,00 Gross profit 726,00 Operating expenses (excluding depreciation) 499, eee Depreciation expense 54, ege Income before taxes 173, eee Income taxes expense 29, eee Net income $ 144, eee Additional Information on Current Year Transactions o. Purchased equipment for $44.400 cash. b. Issued 12,500 shares of common stock for $5 cash per share. c. Declared and paid $94.000 in cash dividends. Required: Prepare a complete statement of cash flows using the indirect method for the current year. (Amounts to be deducted should be Indicated with a minus slgn.) GOLDEN CORPORATION Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current assets and current liabilities $ 0 Cash flows from investing activities Cash flows from financing activities: 0 09 0 Net increase (decrease) in cash Cash balance at December 31. prior year Cash balance at December 31, current year S GOLDEN CORPORATION Spreadsheet for Statement of Cash Flows For Current Year Ended December 31 December 31, Prior Analysis of Changes Year Debit Credit December 31 Current Year $ $ 169,000 Balance sheet-debit balance accounts Cash Accounts receivable Inventory Equipment 112.500 76.000 531,000 304,000 1,023.500 $ $ 169.000 $ Balance sheet-credit balance accounts Accumulated depreciation Equipment Accounts payable Income taxes payable Common stock, $2 par value Paid-in capital in excess of par value, common stock Retained earnings 106.500 76.000 27.600 573.000 167.500 72.900 1.023.500 $ $ Statement of cash flows Operating activities Investing activities Financing activities $ 0 $ 0 GOLDEN CORPORATION Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Net increase (decrease) in cash Cash balance at December 31. prior year Cash balance at December 31, current year
