prepare a direct method cash flow statement for Grow for the year ended 12/31/05. Thank you!!!

P3-9 Grow Company The following is a balance sheet for Grow Co. as of December 31,2004: Grow Co. Balance Sheet December 31,2004 (amounts in millions) Assets Liabilities and Eguities Cash Accounts receivable Inventories Prepaid expenses 13.5 0.7 84.3 Accounts payable Wages payable Interest payable Other accrued expenses S 38.3 7.7 3.8 24.0 Total current assets S1778 Taxes payable Total current liabilities Other liabilities: Senior debt Subordinated debt Other long term liabilities 75.3 Land Buildings Machinery Accumulated depreciation S 3.7 49.8 57.6 30.2 80.9 31.0 49.4 122.0 $11.3 Other assets Preferred stock Total assets $2773 Commn stock APIC Retained earnings Sharcholders' equity 50.4 17.2 80.0 Total liabilities & shareholders' equity $277.5 The following information pertains to 2005 (all amounts are in millions) a. Sales were $501.7, all on account. b. Collections on accounts receivable were $489.8. c. The cost of goods sold was $337.2 d. Depreciation expense was $10.5. e. Cash spent on research and development was S5.7, f. Tax expense was $7 8. Taxes payable at year-end were $5.7 h. Interest expense was $15.9 i. Other cash expenses were $21.7. The other expenses are classified as selling, general, and administrative (SG&A) expenses on the income statement. j. A senior debt issue raised $47.3. k. Dividends paid totaled $16.7 L Wages expense (all SG&A) was S92. m. Unpaid wages at the end of the year were $6.9 n. Interest paid to creditors was $13.9. o. Other assets purchased for cash totaled $9.3. p. Land purchased for cash cost $0.5. q. A building was sold for $1.9 in cash. The building cost Grow $6.0 and had accumu- lated depreciation of $4.1. r. Purchases were $348.1, all on account. S. Payments on accounts payable were $336.7. CHAPTER 3 INCOME STATEMENT CONCEPTS: INCOME, REVENUES. AND EXPENSES 67 t. Purchased a building for $10.5. u. Purchased machinery for $11.7 v. Expirations of prepaid items totaled S6. Prepaids are related to selling, general, and administrative expense accounts. w. Additions to prepaids totaled $8.1 X. Other accrued expenses at the end of the year, all relating to selling, general, and ad ministrative expenses, totaled $29.3. P3-9 Grow Company The following is a balance sheet for Grow Co. as of December 31,2004: Grow Co. Balance Sheet December 31,2004 (amounts in millions) Assets Liabilities and Eguities Cash Accounts receivable Inventories Prepaid expenses 13.5 0.7 84.3 Accounts payable Wages payable Interest payable Other accrued expenses S 38.3 7.7 3.8 24.0 Total current assets S1778 Taxes payable Total current liabilities Other liabilities: Senior debt Subordinated debt Other long term liabilities 75.3 Land Buildings Machinery Accumulated depreciation S 3.7 49.8 57.6 30.2 80.9 31.0 49.4 122.0 $11.3 Other assets Preferred stock Total assets $2773 Commn stock APIC Retained earnings Sharcholders' equity 50.4 17.2 80.0 Total liabilities & shareholders' equity $277.5 The following information pertains to 2005 (all amounts are in millions) a. Sales were $501.7, all on account. b. Collections on accounts receivable were $489.8. c. The cost of goods sold was $337.2 d. Depreciation expense was $10.5. e. Cash spent on research and development was S5.7, f. Tax expense was $7 8. Taxes payable at year-end were $5.7 h. Interest expense was $15.9 i. Other cash expenses were $21.7. The other expenses are classified as selling, general, and administrative (SG&A) expenses on the income statement. j. A senior debt issue raised $47.3. k. Dividends paid totaled $16.7 L Wages expense (all SG&A) was S92. m. Unpaid wages at the end of the year were $6.9 n. Interest paid to creditors was $13.9. o. Other assets purchased for cash totaled $9.3. p. Land purchased for cash cost $0.5. q. A building was sold for $1.9 in cash. The building cost Grow $6.0 and had accumu- lated depreciation of $4.1. r. Purchases were $348.1, all on account. S. Payments on accounts payable were $336.7. CHAPTER 3 INCOME STATEMENT CONCEPTS: INCOME, REVENUES. AND EXPENSES 67 t. Purchased a building for $10.5. u. Purchased machinery for $11.7 v. Expirations of prepaid items totaled S6. Prepaids are related to selling, general, and administrative expense accounts. w. Additions to prepaids totaled $8.1 X. Other accrued expenses at the end of the year, all relating to selling, general, and ad ministrative expenses, totaled $29.3