P12-1 (Algo) Preparing a Statement of Cash Flows (Indirect Method) LO12-1, 12-2, 12-4, 12-6 Sharp Screen Films, Incorporated, is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized as follows: Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings Income statement for current year Sales Cost of goods sold. Depreciation expense Other expenses Net income Current Year Prior Year $ 65,900 $ 67,350 18,550 25,350 20,000 152,900 (47,350) 25,350 213,150 (62,400) $ 262,000 $ 12,400 $ 22,700 4,800 62,600 102,800 5,200 75,800 67,300 79,400 45,800 $ 262,000 $ 216,800 $ 216,800 $ 209,000 106,000 15,050 44,400 $ 43,550

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P12-1 (Algo) Preparing a Statement of Cash Flows (Indirect Method) LO12-1, 12-2, 12-4, 12-6
Sharp Screen Films, Incorporated, is developing its annual financial statements at December 31, current year. The statements are
complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized
as follows:
Balance sheet at December 31
Cash
Accounts receivable
Merchandise inventory
Property and equipment
Less: Accumulated depreciation
Accounts payable
Wages payable
Note payable, long-term
Common stock and additional paid-in capital
Retained earnings
Income statement for current year
Sales
Cost of goods sold
Depreciation expense
Other expenses
Net income
Current Year Prior Year
$ 67,350
18,550
25,350
213,150
(62,400)
$ 262,000
$ 12,400
4,800
62,600
102,800
79,400
$ 262,000
$ 209,000
106,000
15,050
44,400
$ 43,550
$ 65,900
25,350
20,000
152,900
(47,350)
$ 216,800
$ 22,700
5,200
75,800
67,300
45,800
$216,800
Transcribed Image Text:P12-1 (Algo) Preparing a Statement of Cash Flows (Indirect Method) LO12-1, 12-2, 12-4, 12-6 Sharp Screen Films, Incorporated, is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized as follows: Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings Income statement for current year Sales Cost of goods sold Depreciation expense Other expenses Net income Current Year Prior Year $ 67,350 18,550 25,350 213,150 (62,400) $ 262,000 $ 12,400 4,800 62,600 102,800 79,400 $ 262,000 $ 209,000 106,000 15,050 44,400 $ 43,550 $ 65,900 25,350 20,000 152,900 (47,350) $ 216,800 $ 22,700 5,200 75,800 67,300 45,800 $216,800
Additional Data:
a. Bought equipment for cash, $60,250.
b. Paid $13,200 on the long-term note payable.
c. Issued new shares of stock for $35,500 cash.
d. Dividends of $9,950 were declared and paid.
e. Other expenses all relate to wages.
f. Accounts payable includes only inventory purchases made on credit.
Required:
1. Prepare the statement of cash flows using the indirect method for the year ended December 31, current year.
Note: List cash outflows as negative amounts.
Transcribed Image Text:Additional Data: a. Bought equipment for cash, $60,250. b. Paid $13,200 on the long-term note payable. c. Issued new shares of stock for $35,500 cash. d. Dividends of $9,950 were declared and paid. e. Other expenses all relate to wages. f. Accounts payable includes only inventory purchases made on credit. Required: 1. Prepare the statement of cash flows using the indirect method for the year ended December 31, current year. Note: List cash outflows as negative amounts.
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