Presented below are data taken from the records of Morganstern Company. December 31, December 31, 2015 2014 Cash $15,000 $5,000 Current assets other than cash 105,000 129,000 Long-term investments 60,000 50,000 Plant assets 330,000 351,000 $510,000 $535,000 Accumulated depreciation 88,000 102,000 Current liabilities 65,000 73,000 Bonds payable 50,000 100,000 Capital stock 173,000 153,000 Retained earnings 134,000 107,000 $510,000 $535,000 Additional information: 1. Held-to maturity securities carried at a cost of $25,000 on December 31, 2014, were sold in 2012 for $30,000. The gain (not extraordinary) was incorrectly charged directly to Retained Earnings. 2. Fully depreciated plant assets that cost $57,000 were sold during 2015 for $2,000. The gain (not extraordinary) was incorrectly charged directly to Retained Earnings. 3. Net income as reported on the income statement for the year was $40,000. 4. Dividends paid amounted to $20,000. 5. Depreciation charged for the year was $43,000. Required:

Prepare a statement of cash flows for the year 2015 using the indirect method.

Extra Credit Problem Presented below are data taken from the records of Morganstern Company. Cash Current assets other than cash Long-term investments Plant assets Accumulated depreciation Current liabilities Bonds payable Capital stock Retained earnings December 31, 2015 $15,000 105,000 60,000 330,000 $510,000 88,000 65,000 50,000 173,000 134,000 $510,000 December 31, 2014 $5,000 129,000 50,000 351,000 $535,000 102,000 73,000 100,000 153,000 107,000 $535,000 Additional information: 1. Held-to maturity securities carried at a cost of $25,000 on December 31, 2014, were sold in 2012 for $30,000. The gain (not extraordinary) was incorrectly charged directly to Retained Earnings. 2. Fully depreciated plant assets that cost $57,000 were sold during 2015 for $2,000. The gain (not extraordinary) was incorrectly charged directly to Retained Earnings. 3. Net income as reported on the income statement for the year was $40,000. 4. Dividends paid amounted to $20,000. 5. Depreciation charged for the year was $43,000. Required: Prepare a statement of cash flows for the year 2015 using the indirect method. MORGENSTERN COMPANY Statement of Cash Flows For the Year Ended December 31, 2015 Cash flows from operating activities Net income (a) Adjustments to reconcile net income to net cash provided by operating activities: Amount Title Title Title Title Title Net cash provided by operating activities Amount Amount Amount Amount Amount Formula Formula Cash flows from investing activities Title Title Title Title Net cash provided by investing activities Amount Amount Amount Amount Cash flows from financing activities Title Title Title Net cash used by financing activities Amount Amount Amount Formula Formula Increase in cash Title Title Amount Amount Formula Purchase of Plant Assets Plant assets, December 31, 2014 Less: Plant assets sold Amount Amount Plant assets, December 31, 2015 Plant assets purchased during 2015 Amount Note: All yellow boxes must be filled in. You are given the beginning and ending cash balances. Name: MORGENSTERN COMPANY Statement of Cash Flows For the Year Ended December 31, 2015 Cash flows from operating activities Net income (a) Adjustments to reconcile net income to net cash provided by operating activities: Title Title Title Title Title Net cash provided by operating activities Amount Amount Amount Amount Amount Amount Cash flows from investing activities Title Title Title Title Net cash provided by investing activities Amount Amount Amount Amount Cash flows from financing activities Title Title Title Net cash used by financing activities Formula Formula Amount Amount Amount Formula Formula Increase in cash Title Title Amount Amount Formula Purchase of Plant Assets Plant assets, December 31, 2014 Less: Plant assets sold Amount Amount Plant assets, December 31, 2015 Plant assets purchased during 2015 Amount Note: All yellow boxes must be filled in. You are given the beginning and ending cash balances