The following are financial statements for Germaine Company:
Germaine Company
Comparative Balance Sheet
December 31, 2013 and 2012
(Dollars in thousands)
................................................................................. 2013 ........................2012
Assets
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 22 ........................ $ 16
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225 ......................... 245
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105 ......................... 125
Prepaid general expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 .......................... 12
Plant assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,025 ...................... 1,000
Accumulated depreciation-plant assets . . . . . . . . . . . . . . . . . . . . . (530) ...................... (585)
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 868 ..................... $ 813
Liabilities and Stockholders' Equity
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 70 ...................... $ 45
Interest payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 ......................... 12
Income taxes payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80 ......................... 77
Bonds payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105 ........................ 97
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362 ....................... 354
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 236 ....................... 228
Total liabilities and stockholders' equity . . . . . . . . . . . . . . . . . . . . . $ 868 ................... $ 813
Germaine Company
Condensed Income Statement
For the Year Ended December 31, 2013
(Dollars in thousands)
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,450
Cost of goods sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 990
Gross profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 460
Operating expenses:
Depreciation expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 55
General expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 340
Interest expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 ............... 422
Net income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 38
The following information is also available for 2013:
(a) Plant assets were sold for their book value of $180 during the year. The assets had an original cost of $290.
(b) Cash dividends totaling $30 were paid during the year.
(c) All accounts payable relate to inventory purchases.
(d) All purchases of plant assets were cash transactions.
Prepare a statement of cash flows for 2013 using the indirect method.