Statement of Cash Flows (Indirect Method)

The Lowe Companys income statement and comparative balance sheets as of December 31 of 2019 and 2018 are presented below:

LOWE COMPANY Income Statement For the Year Ended December 31, 2019
Sales Revenue		$925,000
Cost of Goods Sold	$490,000
Wages Expense	207,000
Depreciation Expense	62,000
Insurance Expense	17,000
Interest Expense	12,000
Income Tax Expense	57,000
Gain on Sale of Equipment	(16,000)	829,000
Net Income		$96,000

LOWE COMPANY Balance Sheets
	Dec. 31, 2019	Dec. 31, 2018
Assets
Cash	$25,000	$33,000
Accounts Receivable	68,000	51,000
Inventory	177,000	126,000
Prepaid Insurance	8,000	11,000
Plant Assets	887,000	763,000
Accumulated Depreciation	(191,000)	(175,000)
Total Assets	$974,000	$809,000
Liabilities and Stockholders Equity
Accounts Payable	$37,000	$27,000
Interest Payable	7,000	-
Income Tax Payable	11,000	19,000
Bonds Payable	145,000	80,000
Common Stock	660,000	585,000
Retained Earnings	166,000	98,000
Treasury Stock	(52,000)	-
Total Liabilities and Stockholders Equity	$974,000	$809,000

During the year, Lowe Company sold equipment for $27,000 cash that originally cost $57,000 and had $46,000 accumulated depreciation. New equipment was purchased for cash. Bonds payable and common stock were issued for cash. Cash dividends of $28,000 were declared and paid. At the end of the year, shares of treasury stock were purchased for cash. Accounts payable relate to merchandise purchases.

Required a. Compute the change in cash that occurred during 2019. b. Prepare a statement of cash flows using the indirect method.

a. Change in Cash during 2019 $Answer

AnswerIncreaseDecrease

b. Use a negative sign with cash outflow answers.

LOWE COMPANY Statement of Cash Flows For Year Ended December 31, 2019
Cash Flow from Operating Activities
Net Income		Answer
Add (deduct) items to convert net income to cash basis
Depreciation		Answer
Gain on Sale of Equipment		Answer
Accounts Receivable	AnswerIncreaseDecrease	Answer
Inventory	AnswerIncreaseDecrease	Answer
Prepaid Insurance	AnswerIncreaseDecrease	Answer
Accounts Payable	AnswerIncreaseDecrease	Answer
Interest Payable	AnswerIncreaseDecrease	Answer
Income Tax Payable	AnswerIncreaseDecrease	Answer
Cash Flow Provided by Operating Activities		Answer
Cash Flow from Investing Activities
Sale of Equipment		Answer
Purchase of Equipment		Answer
Cash Used by Investing Activities		Answer
Cash Flow from Financing Activities
Issuance of Bonds Payable		Answer
Purchase of Common Stock		Answer
Payment of Dividends		Answer
Purchase of Treasury Stock		Answer
Cash Provided by Financing Activities		Answer
Net Change in Cash		Answer
Cash at Beginning of Year		Answer
Cash at End of Year		Answer