Prepare the statement of cash flow operating section only for Tire Corp. as of December 31, 2013 based on the following comparative balance sheet and supplemental information. Prepare the section using the indirect method on the provided template.
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Tire Corp.
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Comparative Balance Sheet
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December 31, 2013
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2013
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2012
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Current Assets:
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Cash
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83,375
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32,500
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Accounts Receivable
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92,500
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81,250
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Inventory
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215,000
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225,000
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Plant, Property, & Equipment:
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Land
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100,000
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150,000
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Buildings
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325,000
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250,000
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Accumulated Depreciation
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(81,625)
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(72,875)
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Total Assets
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734,250
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665,875
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Current Liabilities:
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Accounts Payable
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54,375
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58,375
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Accrued Expenses
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33,125
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30,375
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Income Taxes Payable
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9,875
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10,500
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Long-Term Liabilities:
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Notes Payable
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125,000
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187,500
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Total Liabilities
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222,375
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286,750
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Stockholder's Equity:
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Common Stock ($5 Par)
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30,000
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20,000
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Paid-In Capital in Excess of Par
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106,250
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106,250
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Retained Earnings
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375,625
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252,875
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Total Stockholder's Equity
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511,875
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379,125
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Total Liabilities & Stockholder's Equity
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734,250
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665,875
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Supplemental Information:
- Net Income was $135,000.
- Depreciation expense was $8,750 for the year.
- Land being held for an investment was sold for $50,000 cash for a gain of $6,250.
- The company purchased a new building for cash costing $75,000.
- Between September 1 and December 31 the company issued 2,000 shares of $5 par common stock for cash at par.
- In July, Tire Corp. paid PNC Bank $62,500 to satisfy note payable.
- Dividends were declared and paid in December of 2011 in the amount of $6,000.