The Wolff Company's income statement and comparative balance sheets at December 31 of 2013 and 2012 are shown below: WOLFF COMPANY Income Statement For the Year Ended December 31, 2013 Sales Revenue $762,000 Cost of Goods Sold $516,000 Wages Expense 103,200 Insurance Expense 9,600 Depreciation Expense 20,400 Interest Expense 10,800 Income Tax Expense 34,800 694,800 Net Income $67,200 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec 31, 2012 Assets $13,200 $6,000 49,200 108,000 38,400 72,000 Cash Accounts Receivable Inventory Prepaid Insurance Plant Assets Accumulated Depreciation Total Assets Liabilities 6,000 300,000 8,400 234,000 (81,600) $394,800 (61,200) $297,600 a Business Course Support $8,400 $12,000 10,800 7,200 8,400 Liabilities and Stockholders' Equity Accounts Payable Wages Payable Income Tax Payable Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders Equity 9,600 156,000 90,000 108,000 108,000 103,200 70,800 $394,800 $297,600 Cash dividends of $34,800 were declared and paid during 2013. Plant assets were purchased for cash and bonds payable were issued for cash. Bond interest is paid semi-annually on June 30 and December 31. Accounts payable relate to merchandise purchases. Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the direct method. c. Compute free cash flow. Business Course Support: 0 Cash dividends of $34,800 were declared and paid during 2013. Plant assets were purchased for cash and bonds payable were issued for cash. Bond interest is paid semi-annually on June 30 and December 31. Accounts payable relate to merchandise purchases. Required a. Calculate the change in cash that occurred during 2013 b. Prepare a statement of cash flows using the direct method. c. Compute free cash flow. d. Compute the operating cash-flow-to-current liabilities ratio. e. Compute the operating-cash-flow to capital expenditures ratio. Increase 67,200 X a. Change in Cash during 2013$ 7,200 b. Use a negative sign with cash outflow answers. WOLFF COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash Flow from Operating Activities Cash Received from Customers Cash paid for Merchandise Purchased $ OX Cash Paid to Employees 0X Cash Paid as Insurance 0X Cash Paid for Interest Cash Paid as Income Taxes OX Cash Provided by Operating Activities Cash Flow from Investing Activities Purchase of Plant Assets OX 0X 0X OX 67,200 x . Use a negative sign with cash outflow answers. WOLFF COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash Flow from Operating Activities Cash Received from Customers $ Cash paid for Merchandise Purchased $ OX Cash Paid to Employees OX Cash Paid as Insurance 0 x Cash Paid for Interest OX Cash Paid as Income Taxes OX Cash Provided by Operating Activities Cash Flow from Investing Activities Purchase of Plant Assets Cash Flow from Financing Activities Issuance of Bonds Payable 0 x Payment of Dividends 0 x Cash Provided by Financing Activities Net Change in Cash Cash at Beginning of Year Cash at End of Year 0 x 0 x 0X OX OX 0 x OX c. Free cash flow $ (24,000) d. Operating-cash-flow-to-current-liabilities ratio. Round answer to two decimal places. 1.49