Required: Prepare the DuVall Candy Company statement of cash flows, using the indirect method. DuVall Candy Company Income Statement For the Year Ended December 31, 2022 ($ in thousands) Sales Revenue $ 17,650 Operating Expenses: Cost of Goods Sold 7,200 Selling Expense 2,400 General and Admin Expense 1,500 Total Operating Expenses 11,100 Operating Income 6,550 Interest Expense 200 Income before Income Taxes 6,350 Income Tax Expense 2,500 Net Income 3,850 Balance Sheet Information ($ in thousands) Dec. 31, 2022 Dec. 31, 2021 Assets: Cash $ 7,350 2,200 Accounts Receivable 2,500 2,200 Inventory 4,000 3,000 Prepaid Rent 150 300 Equipment 14,500 12,000 Less: Accumulated Depreciation (5,100) (4,500) Total Assets 23,400 15,200 Liabilities and Shareholders' Equity: Accounts Payable $ 1,400 1,100 Interest Payable 100 - Unearned Revenue 800 600 Income Taxes Payable 550 800 Notes Payable (due 12/31/2025) 5,000 - Common Stock 10,000 10,000 Retained Earnings 5,550 2,700 Total Liabilities and Shareholders' Equity 23,400 15,200 Other Information needed: Cash Dividend declared and paid 1,000 Equipment was purchased with cash 2,500 Depreciation included in operating expenses 600

Required: Prepare the DuVall Candy Company statement of cash flows, using the indirect method. DuVall Candy Company Income Statement For the Year Ended December 31, 2022 ($ in thousands) Sales Revenue $ 17,650 Operating Expenses: Cost of Goods Sold 7,200 Selling Expense 2,400 General and Admin Expense 1,500 Total Operating Expenses 11,100 Operating Income 6,550 Interest Expense 200 Income before Income Taxes 6,350 Income Tax Expense 2,500 Net Income 3,850 Balance Sheet Information ($ in thousands) Dec. 31, 2022 Dec. 31, 2021 Assets: Cash $ 7,350 2,200 Accounts Receivable 2,500 2,200 Inventory 4,000 3,000 Prepaid Rent 150 300 Equipment 14,500 12,000 Less: Accumulated Depreciation (5,100) (4,500) Total Assets 23,400 15,200 Liabilities and Shareholders' Equity: Accounts Payable $ 1,400 1,100 Interest Payable 100 - Unearned Revenue 800 600 Income Taxes Payable 550 800 Notes Payable (due 12/31/2025) 5,000 - Common Stock 10,000 10,000 Retained Earnings 5,550 2,700 Total Liabilities and Shareholders' Equity 23,400 15,200 Other Information needed: Cash Dividend declared and paid 1,000 Equipment was purchased with cash 2,500 Depreciation included in operating expenses 600

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Required:
Prepare the DuVall Candy Company statement of cash flows, using the indirect method.


DuVall Candy Company
Income Statement
For the Year Ended December 31, 2022

($ in thousands)
Sales Revenue			$	17,650
Operating Expenses:
Cost of Goods Sold			7,200
Selling Expense			2,400
General and Admin Expense		1,500
Total Operating Expenses			11,100
Operating Income				6,550
Interest Expense				200
Income before Income Taxes			6,350
Income Tax Expense				2,500
Net Income				3,850

Balance Sheet Information ($ in thousands)		Dec. 31, 2022	Dec. 31, 2021
Assets:
Cash				$	7,350	2,200
Accounts Receivable				2,500	2,200
Inventory					4,000	3,000
Prepaid Rent				150	300
Equipment				14,500	12,000
Less: Accumulated Depreciation			(5,100)	(4,500)
Total Assets				23,400	15,200
Liabilities and Shareholders' Equity:
Accounts Payable			$	1,400	1,100
Interest Payable				100	-
Unearned Revenue				800	600
Income Taxes Payable				550	800
Notes Payable (due 12/31/2025)			5,000	-
Common Stock				10,000	10,000
Retained Earnings				5,550	2,700
Total Liabilities and Shareholders' Equity		23,400	15,200

Other Information needed:
Cash Dividend declared and paid		1,000
Equipment was purchased with cash		2,500
Depreciation included in operating expenses	600

Expert Solution

Step 1: Introduction of Cash flow Statement

Cash Flow Statement - It is the statement shows the flow of cash and cash equivalent in three different activities named as Cash flow from Operating Activity, Cash flow from Investing Activity and Cash flow from Financing Activity.

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