[muni318]

Use the following balance sheet and income statement to prepare the “Statement of cash
flows” under the “Indirect Method”. (Marks: 20)
Income Statement for Year 2009
$
Sales 100,000
Expense
Cost of goods sold 40,000
Wages 5,000
Depreciation 7,000
Interest 500
Total expenses 52,500
Income from continuing operations 47,500
Gain on sale of land 10,000
Pretax income 57,500
Provision for taxes 20,000
Net income 37,500
Common Dividends declared. 8,500
Balance Sheet for Year 2008 And 2009
2009 2008
$ $
Assets
Current Assets:
Cash 33,000 9,000
Accounts receivables 10,000 9,000
Inventory 5,000 7,000
Non-current Assets
Land 35,000 40,000
Gross Plant and equipment 85,000 60,000
Less: Accumulated Depreciation (16,000) (9,000)
Net plant and equipment 69,000 51,000
Goodwill 10,000 10,000
Total Assets 162,000 126,000
Liabilities
Current Liabilities
Accounts payable 9,000 5,000
Wages payable 4,500 8,000
Interest payable 3,500 3,000
Taxes payable 5,000 4,000
Dividend payable 6,000 1,000
Total current liabilities 28,000 21,000
Non-current liabilities
Bonds 15,000 10,000
Deferred tax liability 20,000 15,000
Total Liabilities 63,000 46,000
Shareholder's Equity
Common Stock 40,000 50,000
Retained Earnings 59,000 30,000
Total Equity 99,000 80,000
Total Liabilities and Shareholder's Equity 162,000 126,000

[rehmanvohra]

It is not permissible to give a solution to your problem. Please post your attempt so that you can be given a proper guidance.

[bacperez]

expanded accounting equation to compute the missing
quantity.
Assets Liabilities Capital Stock Retained Earnings
Case A $23,000 $11,000 A $ 4,500

[morgaine300]

bacperez, you should start a new thread for your post... imagine if everyone just kept using the same thread!

But it's an equation. Write it that way, plug you numbers in, and find the missing one:
Assets = Liabilities + Stock + Retained Earnings

You can't do it without keeping the equation an equation.