PB12-3 Preparing a Statement of Cash Flows (Indirect Method) [LO 12-2, LO 12-3, LO 12-4, LO 12-5]

Audio City, Inc., is developing its annual financial statements at December 31, 2013. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized below:

	2013			2012
Balance Sheet at December 31
Cash	$	37,600		$	45,200
Accounts Receivable		11,400			15,500
Merchandise Inventory		16,600			15,500
Property and Equipment		205,000			141,000
Less: Accumulated Depreciation		(46,500	)		(36,000	)
	$	224,100		$	181,200
Accounts Payable	$	7,100		$	17,200
Wages Payable		2,100			1,000
Note Payable, Long-Term		55,500			66,000
Contributed Capital		82,000			61,000
Retained Earnings		77,400			36,000
	$	224,100		$	181,200
Income Statement for 2013
Sales	$	173,000
Cost of Goods Sold		81,000
Other Expenses		46,500
Net Income	$	45,500

Additional Data:

a.	Bought equipment for cash, $64,000.
b.	Paid $10,500 on the long-term note payable.
c.	Issued new shares of stock for $21,000 cash.
d.	Dividends of $4,100 were paid in cash.
e.	Other expenses included depreciation, $10,500; wages, $15,500; taxes, $20,500.
f.	Accounts Payable includes only inventory purchases made on credit. Because a liability relating to taxes does not exist, assume that they were fully paid in cash.

Required:

Prepare the statement of cash flows for the year ended December 31, 2013, using the indirect method. (List cash outflows as negative amounts.)