Required information [The following information applies to the questions displayed below.] Golden Corporation's current year income statement, comparative balance sheets, and additional information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. GOLDEN CORPORATION Comparative Balance Sheets December 31 Current Year Prior Year Assets Cash Accounts receivable Inventory Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Income taxes payable Total current liabilities Equity Common stock, $2 par value Paid-in capital in excess of par value, common stock Retained earnings Total liabilities and equity GOLDEN CORPORATION Income Statement For Current Year Ended December 31 $ 1,862,000 1,100,000 762,000 508,000 54,000 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income 200,000 41,600 $ 158,400 Additional Information on Current Year Transactions a. Purchased equipment for $59,700 cash. b. Issued 13,400 shares of common stock for $5 cash per share. c. Declared and paid $103,000 in cash dividends. $ 178,000 $ 122,400 104,000 85,000 622,000 540,000 904,000 747,400 372,700 313,000 (165,000) (111,000) $ 1,111,700 $ 115,000 42,000 $ 949,400 $ 85,000 32,100 157,000 117,100 608,800 582,000 221,200 181,000 124,700 69,300 $ 1,111,700 $ 949,400 Required: Prepare a complete statement of cash flows using the indirect method for the current year. Note: Amounts to be deducted should be indicated with a minus sign. Cash flows from operating activities GOLDEN CORPORATION Statement of Cash Flows For Current Year Ended December 31 Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current assets and current liabilities Cash flows from investing activities Cash flows from financing activities: Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year $ 0 0 0 $ 0 $ 0 Balance sheet-debit balance accounts Cash Accounts receivable Inventory Equipment Balance sheet-credit balance accounts Accumulated depreciation-Equipment Accounts payable Income taxes payable Common stock, $2 par value GOLDEN CORPORATION Spreadsheet for Statement of Cash Flows For Current Year Ended December 31 December 31, Prior Year Paid-in capital in excess of par value, common stock Retained earnings Statement of cash flows Operating activities Investing activities Financing activities 69 Analysis of Changes December 31, Debit Credit Current Year 122,400 $ 178,000 85,000 540,000 313,000 1,060,400 $ 178,000 $ 111,000 85,000 32,100 582,000 181,000 69,300 $ 1,060,400 $ 0 0