Statement of Cash Flows Partial balance sheet data and additional information for Ernst Company are listed below: Ernst Company Partial Balance Sheet December 31, 2002 and 2001 Assets 2002 2001 Cash ......................................................................... $ 22,000 $ 16,000 Accounts receivable.................................................. 218,000 260,000 Inventory.................................................................... 85,000 95,000 Liabilities Accounts payable...................................................... $ 105,000 $ 135,000 Additional Information
Statement of Cash Flows Partial balance sheet data and additional information for Ernst Company are listed below: Ernst Company Partial Balance Sheet December 31, 2002 and 2001 Assets 2002 2001 Cash ......................................................................... $ 22,000 $ 16,000 Accounts receivable.................................................. 218,000 260,000 Inventory.................................................................... 85,000 95,000 Liabilities Accounts payable...................................................... $ 105,000 $ 135,000 Additional Information
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Statement of Cash Flows
Partial balance sheet data and additional information for Ernst Company are listed
below:
Ernst Company
Partial Balance Sheet
December 31, 2002 and 2001
Assets 2002 2001
Cash ......................................................................... $ 22,000 $ 16,000
Inventory.................................................................... 85,000 95,000
Liabilities
Accounts payable...................................................... $ 105,000 $ 135,000
Additional Information:
(a) Net income for 2002 was $15,000.
(b) Depreciation expense for 2002 was $30,000.
(c) Sales for 2002 totaled $490,000; cost of goods sold was $350,000.
Requirements:
a) Prepare the operating activities section of the statment of cash flows using INDIRECT METHOD.
b) Prepare the operating activities section of the statment of cash flows using DIRECT METHOD.
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