Reference no: EM132538464
ERISA MAGAMBO A/S
Comparative Statements of Financial Position
December 31
Assets 2017 2016
Land € 75,000 €100,000
Equipment 250,000 200,000
Accumulated depreciation-equipment (66,000) (42,000)
Inventory 180,000 187,000
Accounts receivable 85,000 76,000
Cash 58,000 22,000
Total €582,000 €543,000
Equity and Liabilities
Share capital-ordinary (€1 par) €214,000 €164,000
Retained earnings 184,000 134,000
Bonds payable 150,000 200,000
Accounts payable 34,000 45,000
Total €582,000 €543,000
Additional information:
1. Net income for 2017 was €120,000.
2. Cash dividends of €70,000 were declared and paid.
3. Bonds payable amounting to €50,000 were redeemed for cash €50,000.
4. Ordinary shares were issued for €50,000 cash.
5. Depreciation expense was €24,000.
6. Sales for the year were €978,000.
Required
Question 1: Prepare a worksheet for a statement of cash flows for 2017 using the indirect method. Enter the reconciling items directly on the worksheet, using letters to cross-reference each entry.