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Problem 11-4A (Algo) Prepare a statement of cash flowsindirect method (LO11-2, 11-3, 11-4, 11-5) The income statement, balance sheets, and additional information for Video Phones,

Problem 11-4A (Algo) Prepare a statement of cash flowsindirect method (LO11-2, 11-3, 11-4, 11-5)

The income statement, balance sheets, and additional information for Video Phones, Incorporated, are provided.

VIDEO PHONES, INCORPORATED
Income Statement
For the Year Ended December 31, 2024
Net sales $3,636,000
Expenses:
Cost of goods sold $2,450,000
Operating expenses 958,000
Depreciation expense 37,000
Loss on sale of land 9,000
Interest expense 20,000
Income tax expense 58,000
Total expenses 3,532,000
Net income $ 104,000
VIDEO PHONES, INCORPORATED
Balance Sheets
December 31
2024 2023
Assets
Current assets:
Cash $254,600 $227,800
Accounts receivable 92,000 70,000
Inventory 105,000 145,000
Prepaid rent 14,400 7,200
Long-term assets:
Investments 115,000 0
Land 220,000 260,000
Equipment 290,000 220,000
Accumulated depreciation (81,000) (44,000)
Total assets $1,010,000 $886,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 75,000 $ 91,000
Interest payable 7,000 12,000
Income tax payable 16,000 15,000
Long-term liabilities:
Notes payable 305,000 235,000
Stockholders' equity:
Common stock 400,000 400,000
Retained earnings 207,000 133,000
Total liabilities and stockholders equity $1,010,000 $886,000

Additional Information for 2024:

Purchased investment in bonds for $115,000.

Sold land for $31,000. The land originally was purchased for $40,000, resulting in a $9,000 loss being recorded at the time of the sale.

Purchased $70,000 in equipment by issuing a $70,000 long-term note payable to the seller. No cash was exchanged in the transaction.

Declared and paid a cash dividend of $30,000.

Required:

Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note. (Amounts to be deducted, cash outflows, and any decrease in cash should be indicated with a minus sign.)

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