Prepare a statement of cash flows for the year ending in December 31,2012 using the indirect method.

ALLEN COMPANY

Comparative Balance Sheet

Assets Dec.31, 2012 Dec.31,2011

Cash $28,000 $13,000

A/R 18,000 14,000

Prepaid Expenses 7,000 9,000

Inventory 25,000 15,000

Long Term Investments 16,000 18,000

Equipment 60,000 30,000

Accumulated DEprec. Equip (18,000) (14,000)

Total Assets $120,000 $85,000

Liabilities & Stock Holders Equity

A/P 25,000 7,000

Bonds Payable 37,000 45,000

Common Stock 40,000 23,000

Retained Earnings 18,000 10,000

Total Liabilities & Stockholders Equity $116,000 $85,000

Additional Info

1. Net Income for year ending Dec.31,2012 was $20,000

2. Cash dividends of $12,000 were declared and paid during the year.

3. Long term investments that had a book value for $18,000 were sold for $16,000.

4. Sales for 2012 are $120,000