Statement of Cash Flows

1 The following are Rencos Balance Sheets for 2008 and 2009:

Beg. Bal. End. Bal.

Assets Cash and Cash Equivalents 40,000 89,900

Accounts Receivable 18,000 38,000

Inventory 46,000 12,000

Property, Plant & Equipment (net) 88,100 100,100

Total 192,100 240,000

Liabilities & Stockholder's Equity

Accounts Payable 62,000 20,000

Interest Payable 6,100 8,000

Dividends Payable 1,900 2,800

Income Taxes Payable 8,100 13,700

Notes Payable 20,000 40,000

Capital Stock 48,000 88,000

Retained Earnings 46,000 67,500

Total 192,100 240,000

The following is a summary of transactions for 2009:

a. Net income, $34,400.

b. Interest expense accrued on Notes Payable, $8,000.

c. Equipment purchased by issuing Note Payable, $40,000.

d. Sale of Plant Assets for cash, $12,000. Book Value of the assets sold, $8,000

. e. Issued additional shares of its Capital Stock for $40,000.

f. Income tax expense, $17,600.

g. Sales of merchandise on account, $208,000. Cost of merchandise sold, $120,000.

h. Other expenses paid in cash, $12,000.

i. Depreciation expense, $20,000.

j. Collections of cash from customers, $188,000.

k. Repayment of Notes Payable, $20,000.

l. Dividends declared, $12,900.

Required: Prepare a Statement of Cash Flows using the following methods:

1. The Direct Method, include a Supplementary Schedule of Net Cash Provided by Operating Activities and a Supplementary Schedule of Noncash Investing and Financing Activities.

2. The Indirect Method, include a Worksheet and Supplementary Schedule of Noncash Investing and Financing Activities.