Problem 12-10A

Problem 12-9A Condensed financial data of Odgers Inc. follow. Problem 12-9A Condensed financial data of Odgers Inc. follow. ODGERS INC. Comparative Balance Sheets December 31 Assets 2014 Cash 2013 $ 118,776 $ 71,148 Accounts receivable 129,066 55,860 Inventory 165,375 151,190 Prepaid expenses 41,748 38,220 Long-term investments 202,860 160,230 Plant assets 418,950 356,475 Accumulated depreciation (73,500 ) (76,440 ) Total $1,003,275 $756,683 $ 149,940 $ 98,931 24,255 30,870 Bonds payable 161,700 214,620 Common stock 323,400 257,250 Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Retained earnings Total 343,980 155,012 $1,003,275 $756,683 ODGERS INC. Income Statement Data For the Year Ended December 31, 2014 Sales revenue $571,036 Less: Cost of goods sold $199,126 Operating expenses, excluding depreciation 18,243 Depreciation expense 68,355 Income tax expense 40,102 Interest expense Loss on disposal of plant assets 6,953 11,025 Net income 343,804 $ 227,232 Additional information: 1. New plant assets costing $147,000 were purchased for cash during the year. Old plant assets having an original cost of $84,525 and accumulated depreciation of $71,295 were 2. sold for $2,205 cash. 3. Bonds payable matured and were paid off at face value for cash. 4. A cash dividend of $38,264 was declared and paid during the year. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) ODGERS INC. Statement of Cash Flows For the Year Ended December 31, 2014 Cash Flows fromOperating Activities $ Net Income Adjustments to reconcile net income to Net Cash Provided by Operating Activities $ Depreciation Expense Loss on Disposal of Plant Assets Increase in Accounts Receivable Increase in Inventory Increase in Prepaid Expenses Increase in Accounts Payable Decrease in Accrued Expenses Payable Net Cash Provided by Operating Activities Cash Flows fromInvesting Activities Sale of Plant Assets Purchase of Plant Assets Purchase of Investments Net Cash used by Investing Activities Cash Flows fromFinancing Activities Sale of Common Stock Payment of Cash Dividends Redemption of Bonds Net Cash Provided by Financing Activities Net Decrease in Cash Cash at Beginning of Period $ Cash at End of Period Problem 12-10A Condensed financial data of Odgers Inc. follow. ODGERS INC. Comparative Balance Sheets December 31 Assets Cash 2014 $ 164,832 2013 $ 98,736 Accounts receivable 179,112 77,520 Inventory 229,500 209,814 57,936 53,040 Long-term investments 281,520 222,360 Plant assets 581,400 494,700 Prepaid expenses Accumulated depreciation Total (102,000 ) (106,080 ) $1,392,300 $1,050,090 $ 208,080 $ 137,292 33,660 42,840 Bonds payable 224,400 297,840 Common stock 448,800 357,000 Retained earnings 477,360 215,118 $1,392,300 $1,050,090 Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Total ODGERS INC. Income Statement Data For the Year Ended December 31, 2014 Sales revenue $792,458 Less: Cost of goods sold $276,338 Operating expenses, excluding depreciation 25,316 Depreciation expense 94,860 Income taxes 55,651 Interest expense Loss on disposal of plant assets 9,649 15,300 Net income 477,114 $ 315,344 Additional information: 1. New plant assets costing $204,000 were purchased for cash during the year. Old plant assets having an original cost of $117,300 and accumulated depreciation of 2. $98,940 were sold for $3,060 cash. 3. Bonds payable matured and were paid off at face value for cash. 4. A cash dividend of $53,102 was declared and paid during the year. Further analysis reveals that accounts payable pertain to merchandise creditors. Prepare a statement of cash flows for Odgers Inc. using the direct method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) ODGERS INC. Statement of Cash Flows For the Year Ended December 31, 2014 Cash Flows fromOperating Activities $ Cash Receipts fromCustomers Less : Cash Payments $ For Income Taxes To Suppliers For Operating Expenses For Interest Net Cash Provided by Operating Activities Cash Flows fromInvesting Activities Purchase of Plant Assets Sale of Plant Assets Purchase of Investments Net Cash Provided by Investing Activities Cash Flows fromFinancing Activities Sale of Common Stock Redemption of Bonds Payment of Cash Dividends Net Cash used by Financing Activities Net Increase in Cash Cash at Beginning of Period $ Cash at End of Period Odgers Inc Cash flow Statement Using indirect method Cash flow from operating activities Net Income Adjustments to reconcile net income to net cash flow from operating activities Increase in Accounts Receivable Increase in Inventory Increase in prepaid expenses Depreciation Loss on sales of equipment Increase in Accounts Payable Decrease in Accrued Expenses payable Net cash flow provided from operating activities Cash flows from investing activities Sale of plant assets Purchase of plant assets Purchase of investments Net cash used by investing activities Cash flows from financing activities Sale of common stock Payment of cash dividends Redemption of bonds Net cash used by financing activities Net increase in cash Cash at beginning of period Cash at end of period ment ethod 227232 -73206 -14185 -3528 68355 11025 51009 -6615 32855 260087 2205 -147000 -42630 -187425 66150 -38264 -52920 -25034 47628 71148 118776 Odgers Inc Statement of Cash Flows For the year ended December 31 ' 2014 Cash flows from operating activities Cash receipts from customers Less cash payments: To suppliers For operating expenses For income taxes For interest Net cash provided by operating activities Cash flows from investing activities Sale of plant assets Purchase of plant assets Purchase of investments Net cash used by investing activities Cash flows from financing activities Sale of common stock Payment of cash dividends Redemption of bonds Net cash used by financing activities Net increase in cash Cash at beginning of period Cash at end of period 690866 225236 39,392 55651 9649 329928 360938 3060 -204000 -59160 -260100 91800 -53102 -73440 -34742 66096 98736 164832 Computations: -1 Cash receipts from customers Sales Deduct: Increase in accounts receivable Cash receipts from customers -2 Cash payments to suppliers Cost of goods sold Add: Increase in inventory Cost of purchases Deduct: Increase in accounts payable Cash payments to suppliers -3 Cash payments for operating expenses Operating expenses exclusive of 792458 101592 690866 276338 19686 296024 -70788 225236 depreciation Add: Increase in prepaid expenses Decrease in accrued expenses payable Cash payment for operating expenses 25316 4896 9180 14,076 39,392