| Problem 13-23 Kate Petusky prepared Addison Controls balance sheet and income statement for 2013. Before she could complete the statement of cash flows, she had to leave town to attend to a family emergency. Because the full set of statements must be provided to the auditors today, Addisons president, Lance Meyers, has asked you to prepare the statement of cash flows. Meyers has provided you with the balance sheets and income statement that Petusky prepared, as well as some notes she made: | Addison Controls Income Statement For the Year Ended December 31, 2013 | | Sales revenue | $ 128,800 | | Cost of goods sold | 70,260 | | Gross margin | 58,540 | | Selling expense | $13,040 | | Administrative expense | 8,080 | | Salaries expense | 20,270 | | Depreciation expense | 1,900 | | Interest expense | 4,060 | 47,350 | | Income before gain and taxes | 11,190 | | Gain on sale of Land | 905 | | Income tax expense | 829 | | Net income | $ 11,266 | | Addison Controls Comparative Balance Sheets As of December 31 | | 2013 | 2012 | | Cash | $ | 5,130 | $ | 4,270 | | Accounts receivable, net | 6,380 | 5,550 | | Inventory | 31,710 | 34,200 | | Total current assets | 43,220 | 44,020 | | Property, plant, & equipment, net | 211,790 | 215,490 | | Total Assets | $ | 255,010 | $ | 259,510 | | Accounts payable | $ | 3,430 | $ | 6,120 | | Accrued expenses | 2,580 | 2,330 | | Taxes payable | 2,120 | 2,930 | | Bonds payable | 60,280 | 50,420 | | Total liabilities | 68,410 | 61,800 | | Common stock | 125,270 | 125,270 | | Retained earnings | 61,330 | 72,440 | | Total stockholders equity | 186,600 | 197,710 | | Total liabilities & stockholders equity | $ | 255,010 | $ | 259,510 | | Equipment with an original cost of $35,090 was sold for $20,365. The book value of the equipment was $19,460. | | On June 1, 2013, the company purchased new equipment for cash at a cost of $17,660. | | At the end of the year the company issued bonds payable for $9,860cash. The bonds will mature on December 31, 2017. | | The company paid $22,376 in cash dividends for the year. | Using the indirect method, prepare Addison Controls' statement of cash flows for 2013.(If an amount decreases cash flow then enter with a negative sign preceding the number or parenthesis, e.g. -15,000 or (15,000).) | Addison Control Statement of Cash Flows For the Year Ended December 31, 2013 | | Adjustments to net incomeCash, ending balanceCash flows from operating activitiesCash flows from investing activitiesChange in cashCash flows from financing activitiesCash, beginning balance | | Decrease in accounts receivableIncrease in accounts receivableIncrease in inventoriesDepreciationSale of equipmentGain on sale of landDecrease in inventoriesPurchase of equipmentDecrease in accounts payableDecrease in accrued expensesIncrease in accounts payableIssue bondsIncrease in accrued expensesDecrease in income taxes payableIncrease in income taxes payableCash dividends on common stockNet income / (loss) | $ | | Cash flows from financing activitiesCash, beginning balanceCash, ending balanceCash flows from operating activitiesCash flows from investing activitiesAdjustments to net incomeChange in cash | | Increase in inventoriesDecrease in accounts receivableSale of equipmentNet income / (loss)DepreciationIncrease in accrued expensesDecrease in inventoriesIssue bondsDecrease in accounts payableCash dividends on common stockGain on sale of landIncrease in accounts payableIncrease in accounts receivableDecrease in accrued expensesDecrease in income taxes payableIncrease in income taxes payablePurchase of equipment | $ | | Decrease in inventoriesIncrease in accounts payableNet income / (loss)Gain on sale of landDecrease in accounts payableIncrease in inventoriesPurchase of equipmentIssue bondsDepreciationDecrease in income taxes payableIncrease in accrued expensesSale of equipmentDecrease in accrued expensesCash dividends on common stockIncrease in income taxes payableIncrease in accounts receivableDecrease in accounts receivable | | | Increase in accrued expensesSale of equipmentCash dividends on common stockIncrease in accounts receivableDecrease in income taxes payableDecrease in inventoriesDecrease in accounts receivableIncrease in accounts payableIncrease in inventoriesDecrease in accounts payableDecrease in accrued expensesIncrease in income taxes payablePurchase of equipmentIssue bondsNet income / (loss)DepreciationGain on sale of land | | | Decrease in accounts receivableSale of equipmentIncrease in inventoriesNet income / (loss)DepreciationGain on sale of landDecrease in accounts payableDecrease in inventoriesIncrease in accounts payableIncrease in accrued expensesDecrease in accrued expensesCash dividends on common stockIncrease in income taxes payablePurchase of equipmentIncrease in accounts receivableDecrease in income taxes payableIssue bonds | | | Decrease in accounts receivableIncrease in accounts payableDecrease in income taxes payableIncrease in accounts receivableIncrease in inventoriesDepreciationDecrease in inventoriesPurchase of equipmentIssue bondsCash dividends on common stockNet income / (loss)Decrease in accounts payableIncrease in income taxes payableGain on sale of landIncrease in accrued expensesDecrease in accrued expensesSale of equipment | | | Decrease in accrued expensesIncrease in accrued expensesGain on sale of landIssue bondsDecrease in accounts receivableDepreciationIncrease in accounts receivableDecrease in inventoriesDecrease in income taxes payableSale of equipmentIncrease in inventoriesPurchase of equipmentDecrease in accounts payableCash dividends on common stockIncrease in income taxes payableNet income / (loss)Increase in accounts payable | | | Decrease in accrued expensesDecrease in accounts payableIncrease in income taxes payableCash dividends on common stockSale of equipmentDepreciationPurchase of equipmentDecrease in income taxes payableIssue bondsNet income / (loss)Increase in accrued expensesGain on sale of landIncrease in accounts receivableDecrease in accounts receivableDecrease in inventoriesIncrease in inventoriesIncrease in accounts payable | | | | | Net cashprovidedusedbyoperatinginvestingfinancingactivities | | | Cash, beginning balanceCash flows from financing activitiesCash flows from investing activitiesCash, ending balanceAdjustments to net incomeChange in cashCash flows from operating activities | | DepreciationDecrease in accounts payableIncrease in accounts payableDecrease in accrued expensesIncrease in accrued expensesNet income / (loss)Increase in income taxes payableDecrease in income taxes payableIncrease in accounts receivableSale of equipmentPurchase of equipmentGain on sale of landDecrease in accounts receivableIssue bondsDecrease in inventoriesCash dividends on common stockIncrease in inventories | | | Net income / (loss)DepreciationDecrease in inventoriesIncrease in inventoriesIncrease in income taxes payableDecrease in accounts payableSale of equipmentGain on sale of landIncrease in accounts receivablePurchase of equipmentCash dividends on common stockIncrease in accounts payableDecrease in accounts receivableIncrease in accrued expensesIssue bondsDecrease in accrued expensesDecrease in income taxes payable | | | Net cashusedprovidedbyinvestingfinancingoperatingactivities | | | Cash, ending balanceCash flows from operating activitiesAdjustments to net incomeCash flows from investing activitiesChange in cashCash, beginning balanceCash flows from financing activities | | Decrease in income taxes payableCash dividends on common stockIncrease in accounts payableDecrease in inventoriesIssue bondsIncrease in income taxes payableSale of equipmentIncrease in accounts receivableIncrease in inventoriesDecrease in accounts payableIncrease in accrued expensesPurchase of equipmentNet income / (loss)DepreciationDecrease in accrued expensesGain on sale of landDecrease in accounts receivable | | | DepreciationIncrease in accrued expensesIncrease in inventoriesGain on sale of landCash dividends on common stockDecrease in inventoriesIncrease in income taxes payableNet income / (loss)Increase in accounts receivableDecrease in accounts receivableDecrease in accounts payableIncrease in accounts payableDecrease in accrued expensesDecrease in income taxes payableSale of equipmentPurchase of equipmentIssue bonds | | | Net cashusedprovidedbyinvestingoperatingfinancingactivities | | | Cash flows from operating activitiesChange in cashCash flows from financing activitiesAdjustments to net incomeCash flows from investing activitiesCash, beginning balanceCash, ending balance | | | Cash flows from operating activitiesCash flows from investing activitiesAdjustments to net incomeChange in cashCash, beginning balanceCash, ending balanceCash flows from financing activities | | | Adjustments to net incomeCash flows from financing activitiesChange in cashCash, beginning balanceCash, ending balanceCash flows from operating activitiesCash flows from investing activities | $ | |
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