P11-45. Statement of Cash Flows (Indirect Method).

Artic Companys income statement and comparative balance sheet follow.

ARTIC COMPANY

Income Statement

For Year Ended December 31, 2019.

Sales.. $728,000

Cost of goods sold $534,000

Wages expense 190,000

Advertising expense 31,000

Depreciation expense 22,000

Interest expense 18,000

Gain on sale of land (25,000) 770,000

Net loss $ (42,000)

ARTIC COMPANY

Balance Sheet

December 31, 2019 December 31, 2018

Assets

Cash 49,000 28,000

Accounts receivable . 42,000 50,000

Inventory 107,000 113,000

Prepaid advertising.. 10,000 13,000

Property, plant, equipment. 360,000 222,000

Accumulated depreciation... (78,000) (56,000)

Total assts. 490,000 370,000

Liabilities and Stockholders Equity.

Accounts payable.. 17,000 31,000

Interest payable. 6,000 -

Bonds payable. 200,000 -

Common stock.. 245,000 245,000

Retained earnings.. 52,000 94,000

Treasury Sock. (30,000) -

Total liabilities and equity. 490,000 370,000

During 2019, Artic sold land for $70,000 cash that had originally cost $45,000. Artic also purchased equipment for cash, acquired treasury stock for cash, and issued bonds payable for cash in 2019. Accounts payable relate to merchandise purchases.

Required.

1. Compute the change in cash that occurred during 2019
2. Prepare a 2019 statement of cash flows using the indirect method.