Solution-Prepare a statement of cash flows

Prepare a statement of cash flows

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Reference no: EM131800080

Question - SCF-Indirect Method

Andrews Inc., a greeting card company, had the following statements prepared as of December 31, 2010.

ANDREWS INC. Comparative Balance Sheet as of December 31, 2010 and 2009
	12/31/10	12/31/09
Cash	$ 5,981	$ 9,008
Accounts Receivable	62,124	48,810
Short-term investments (Available-for-sale)	34,834	18,083
Inventories	39,952	60,125
Prepaid rent	4,877	4,180
Printing equipment	153,030	129,250
Accumulated depr.-equipment	(34,899)	(24,875)
Copyrights	45,764	50,582
Total assets	$311,663	$295,163

Accounts payable	$ 45,834	$ 41,998
Income taxes payable	3,999	6,191
Wages payable	7,666	4,270
Short-term loans payable	8,016	9,931
Long-term loans payable	59,989	66,890
Common stock, $10 par	100,460	100,460
Contributed capital, common stock	29,870	29,870
Retained earnings	55,829	35,553
Total liabilities & equity	$311,663	$295,163

ANDREWS INC. Income Statement For the Year Ended December 31, 2010
Sales		$337,397
Cost of goods sold		175,640
Gross Margin		161,757
Operating expenses		119,170
Operating income		42,587
Interest expense	$11,466
Gain on sale of equipment	1,743	9,723
Income before tax		32,864
Income tax expense		6,603
Net income		$ 26,261

Additional information:

1. Dividends in the amount of $5,985 were declared and paid during 2010.

2. Depreciation expense and amortization expense are included in operating expenses.

3. No unrealized gains or losses have occurred on the investments during the year.

4. Equipment that had a cost of $29,200 and was 70% depreciated was sold during 2010.

Instructions - Prepare a statement of cash flows using the indirect method.

Reference no: EM131800080

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Prepare a statement of cash flows

Reference no: EM131800080

Reference no: EM131800080

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