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Peoria Corp. just completed another successful year, as indicated by the following income statement: For the Year Ended December 31, 2012 Sales revenue $1,250,000 Cost of goods sold 700,000 Gross profit $ 550,000 Operating expenses 150,000 Income before interest and taxes $ 400,000 Interest expense 25,000 Income before taxes $ 375,000 Income tax expense 150,000 Net income $ 225,000 Presented here are comparative balance sheets: December 31 2012 2011 Cash $ 52,000 $ 90,000 Accounts receivable 180,000 130,000 Inventory 230,000 200,000 Prepayments 15,000 25,000 Total current assets $ 477,000 $ 445,000 Land $ 750,000 $ 600,000 Plant and equipment 700,000 500,000 Accumulated depreciation (250,000) (200,000) Total long-term assets $1,200,000 $ 900,000 Total assets $1,677,000 $1,345,000 Accounts payable $ 130,000 $ 148,000 Other accrued liabilities 68,000 63,000 Income taxes payable 90,000 110,000 Total current liabilities $ 288,000 $ 321,000 Long-term bank loan payable $ 350,000 $ 300,000 Common stock $ 550,000 $ 400,000 Retained earnings 489,000 324,000 Total stockholders equity $1,039,000 $ 724,000 Total liabilities and stockholders equity $1,677,000 $1,345,000 Other information is as follows: a. Dividends of $60,000 were declared and paid during the year. b. Operating expenses include $50,000 of depreciation. c. Land and plant and equipment were acquired for cash, and additional stock was issued for cash. Cash also was received from additional bank loans. Required: Prepare statement of cash flows for 2012 usingdirect methodin the operating activities section Problem 12-4 Statement of Cash Flows Indirect Method Refer to all of the facts in Problem 12-3. Required Prepare a statement of cash flows for 2012 using theindirect methodin the Operating Activities section.

Peoria Corp. just completed another successful year, as indicated by the following income statement:

For the Year Ended

December 31, 2012

Sales revenue $1,250,000

Cost of goods sold 700,000

Gross profit $ 550,000

Operating expenses 150,000

Income before interest and taxes $ 400,000

Interest expense 25,000

Income before taxes $ 375,000

Income tax expense 150,000

Net income $ 225,000

Presented here are comparative balance sheets:

December 31 2012 2011

Cash $ 52,000 $ 90,000

Accounts receivable 180,000 130,000

Inventory 230,000 200,000

Prepayments 15,000 25,000

Total current assets $ 477,000 $ 445,000

Land $ 750,000 $ 600,000

Plant and equipment 700,000 500,000

Accumulated depreciation (250,000) (200,000)

Total long-term assets $1,200,000 $ 900,000

Total assets $1,677,000 $1,345,000

Accounts payable $ 130,000 $ 148,000

Other accrued liabilities 68,000 63,000

Income taxes payable 90,000 110,000

Total current liabilities $ 288,000 $ 321,000

Long-term bank loan payable $ 350,000 $ 300,000

Common stock $ 550,000 $ 400,000

Retained earnings 489,000 324,000

Total stockholders equity $1,039,000 $ 724,000

Total liabilities and stockholders equity $1,677,000 $1,345,000

Other information is as follows:

a. Dividends of $60,000 were declared and paid during the year.

b. Operating expenses include $50,000 of depreciation.

c. Land and plant and equipment were acquired for cash, and additional stock was issued for cash. Cash also was received from additional bank loans.

Required:

Prepare statement of cash flows for 2012 usingdirect methodin the operating activities section

 

Problem 12-4 Statement of Cash Flows Indirect Method

Refer to all of the facts in Problem 12-3.

Required

Prepare a statement of cash flows for 2012 using theindirect methodin the Operating Activities section.

 

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