Problem 14-7 Prepare a Statement of Cash Flows [LO14-1, LO14-2] [The following information applies to the questions displayed below.] Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year $ 13 293 155 9 470 513 (80) 433 24 $ 12 231 194 6 443 433 (70) 363 31 $ 927 $837 Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Long-term investments Total assets Liabilities and Stockholders Equity Accounts payable Accrued liabilities Income taxes payable Total current liabilities Bonds payable Total liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 303 71 71 445 195 640 164 123 287 $ 226 79 64 369 172 541 201 95 296 $ 927 $ 837 $ 754 448 Weaver Company Income Statement For This Year Ended December 31 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items: Gain on sale of investments $ Loss on sale of equipment Income before taxes Income taxes Net income 306 221 85 6 (2) 4 89 24 $ 65 During this year, Weaver sold some equipment for $19 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $7 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $37 of its own stock. This year Weaver did not retire any bonds. Problem 14-7 Part 1 Required: 1. Using the indirect method, determine the net cash provided by/used in operating activities for this year. (List any deduction in cash and cash outflows as negative amounts.) Weaver Company Statement of Cash Flows-Indirect Method (partial) Net income $ 65 Adjustments to convert net income to a cash basis: Depreciation Gain on sale of investments $ 20 (7) 2 Loss on sale of equipment Increase in accounts receivable Decrease in inventory 15 $ 80 Problem 14-7 Part 2 2. Using the information from Part 1, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. (List any deduction in cash and cash outflows as negative amounts.) Weaver Company Statement of Cash Flows For This Year Ended December 31 Operating activities: Investing activities: Financing activities: Beginning cash and cash equivalents Ending cash and cash equivalents