Statement of Cash Flows (Indirect Method) The Sweet Company's income statement and comparative balance sheets as of December 31 of 2013 and 2012 are presented below:

SWEET COMPANY Income Statement For the Year Ended December 31, 2013
Sales Revenue		$1,229,800
Cost of Goods Sold	$659,100
Wages Expense	263,900
Depreciation Expense	78,000
Insurance Expense	16,900
Interest Expense	15,600
Income Tax Expense	74,100
Gain on Sale of Equipment	(20,800)	1,086,800
Net Income		$143,000

SWEET COMPANY Balance Sheets
	Dec. 31, 2013	Dec. 31, 2012
Assets
Cash	$29,900	$40,300
Accounts Receivable	88,400	55,900
Inventory	230,100	163,800
Prepaid Insurance	11,700	14,300
Plant Assets	1,153,100	1,001,000
Accumulated Depreciation	(245,700)	(227,500)
Total Assets	$1,267,500	$1,047,800
Liabilities and Stockholders' Equity
Accounts Payable	$48,100	$35,100
Interest Payable	6,500	-
Income Tax Payable	15,600	20,800
Bonds Payable	175,500	104,000
Common Stock	858,000	760,500
Retained Earnings	231,400	127,400
Treasury Stock	(67,600)	-
Total Liabilities and Stockholders' Equity	$1,267,500	$1,047,800

During the year, Sweet Company sold equipment for $35,100 cash that originally cost $74,100 and had $59,800 accumulated depreciation. New equipment was purchased for cash. Bonds payable and common stock were issued for cash. Cash dividends of $39,000 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 2013. b. Prepare a statement of cash flows using the indirect method. a. Change in Cash during 2013 $Answer AnswerIncreaseDecrease

b. Use a negative sign with cash outflow answers.

SWEET COMPANY Statement of Cash Flows For Year Ended December 31, 2013
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 AnswerIncreaseDecrease in Cash		Answer
Cash at Beginning of Year		Answer
Cash at End of Year		$Answer

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ACCT211:02-Financial Accounting

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Chapter 3

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Chapter 6

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