Question 4 Not complete Marked out of 23.00 Statement of Cash Flows (Indirect Method) Wolff Company's income statement and comparative balance sheets follow. WOLFF COMPANY Income Statement For Year Ended December 31, 2019 Sales $952,500 Cost of goods sold $645,000 Wages expense 129,000 Insurance expense 12,000 Depreciation expense 25,500 Interest expense 13,500 Income tax expense 43,500 868,500 Net income $84,000 WOLFF COMPANY Balance Sheet Dec 31, 2019 Dec 31, 2018 Assets Cash $16,500 $7.500 Accounts receivable 61,500 48,000 Inventory 135,000 90,000 Prepaid insurance 7,500 10,500 PPE 375,000 292,500 Accumulated depreciation (102,000) (76,500) Total assets $493,500 $372,000 Liabilities and Stockholders' Equity Accounts payable $10,500 $15,000 Wages payable 13.500 9,000 Income tax payable 10,500 12.000 Bonds payable 195,000 112.500 Common stock 135,000 135,000 Retained earnings 129,000 88,500 Total liabilities and equity $493,500 $372,000 Cash dividends of $43,500 were declared and paid during 2019. Also in 2019, PPE was purchased for cash, and bonds payable were issued for cash. Bond interest is paid semiannually on June 30 and December 31. Accounts payable relate to merchandise purchases. a. Compute the change in cash that occurred during 2019. Note: Do not use negative signs with your answers. Cash, December 31, 2019 $ 0 Less: Cash, December 31, 2018 0 Cash increase during 2019 b. Prepare a 2019 statement of cash flows using the indirect method. Note: Use negative signs with your answers to indicate a decrease in cash (use of cash). WOLFF COMPANY Statement of Cash Flows For Year Ended December 31, 2019 Net Cash How from Operating Activities Add(Deduct) Items to Convert Net Income to Cash Basis OO Accounts Receivable Inventory Prepaid Insurance Accounts Payable Wages Payable Income Tax Payable Net Cash Provided by Operating Activities Cash Flows from Investing Activities 0 0 0 D 0 0 0 Cash Flows from Financing Activities 0 O O Payment of Dividends Net Cash Provided by Financing Activities Net change in cash Cash at Beginning of Year Cash at End of Year 0 0 0 Question 4 Not complete Marked out of 23.00 Statement of Cash Flows (Indirect Method) Wolff Company's income statement and comparative balance sheets follow. WOLFF COMPANY Income Statement For Year Ended December 31, 2019 Sales $952,500 Cost of goods sold $645,000 Wages expense 129,000 Insurance expense 12,000 Depreciation expense 25,500 Interest expense 13,500 Income tax expense 43,500 868,500 Net income $84,000 WOLFF COMPANY Balance Sheet Dec 31, 2019 Dec 31, 2018 Assets Cash $16,500 $7.500 Accounts receivable 61,500 48,000 Inventory 135,000 90,000 Prepaid insurance 7,500 10,500 PPE 375,000 292,500 Accumulated depreciation (102,000) (76,500) Total assets $493,500 $372,000 Liabilities and Stockholders' Equity Accounts payable $10,500 $15,000 Wages payable 13.500 9,000 Income tax payable 10,500 12.000 Bonds payable 195,000 112.500 Common stock 135,000 135,000 Retained earnings 129,000 88,500 Total liabilities and equity $493,500 $372,000 Cash dividends of $43,500 were declared and paid during 2019. Also in 2019, PPE was purchased for cash, and bonds payable were issued for cash. Bond interest is paid semiannually on June 30 and December 31. Accounts payable relate to merchandise purchases. a. Compute the change in cash that occurred during 2019. Note: Do not use negative signs with your answers. Cash, December 31, 2019 $ 0 Less: Cash, December 31, 2018 0 Cash increase during 2019 b. Prepare a 2019 statement of cash flows using the indirect method. Note: Use negative signs with your answers to indicate a decrease in cash (use of cash). WOLFF COMPANY Statement of Cash Flows For Year Ended December 31, 2019 Net Cash How from Operating Activities Add(Deduct) Items to Convert Net Income to Cash Basis OO Accounts Receivable Inventory Prepaid Insurance Accounts Payable Wages Payable Income Tax Payable Net Cash Provided by Operating Activities Cash Flows from Investing Activities 0 0 0 D 0 0 0 Cash Flows from Financing Activities 0 O O Payment of Dividends Net Cash Provided by Financing Activities Net change in cash Cash at Beginning of Year Cash at End of Year 0 0 0