The Fancy Company's comparative balance sheets for 2016 and 2017, and additional information, are presented below. Fancy Company Comparative Balance Sheets December 31, December 31, ASSETS 2017 2016 Cash $ 14,000 $ 9,000 Accounts receivable 52,000 24,000 Inventory 87,000 40,000 Equipment 125,000 100,000 Accumulated depreciation (42,000) (34,000) Prepaid expenses 4,000 2,000 Land -0- 7,000 Building 50,000 -0- Total Assets $290,000 $148,000 LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable $ 25,000 $ 14,000 Interest payable 8,000 6,000 Taxes payable 37,000 11,000 Short-term note payable 37,000 32,000 Bonds payable 75,000 50,000 Common stock, $10 par 75,000 25,000 Retained earnings 33,000 10,000 Total Liabilities and Shareholders’ Equity $290,000 $148,000 Additional 2017 information: Net income, $31,000 Sold land for gain of $3,000 Paid dividends of $8,000 Issued $50,000 common stock to purchase building Required: Prepare Fancy Company's 2017 statement of cash flows using the indirect method.

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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The Fancy Company's comparative balance sheets for 2016 and 2017, and additional information, are presented below.

Fancy Company Comparative Balance Sheets
	December 31,	December 31,
ASSETS	2017	2016
Cash	$ 14,000	$ 9,000
Accounts receivable	52,000	24,000
Inventory	87,000	40,000
Equipment	125,000	100,000
Accumulated depreciation	(42,000)	(34,000)
Prepaid expenses	4,000	2,000
Land	-0-	7,000
Building	50,000	-0-
	Total Assets	$290,000	$148,000

LIABILITIES AND SHAREHOLDERS' EQUITY

Accounts payable	$ 25,000	$ 14,000
Interest payable	8,000	6,000
Taxes payable	37,000	11,000
Short-term note payable	37,000	32,000
Bonds payable	75,000	50,000
Common stock, $10 par	75,000	25,000
Retained earnings	33,000	10,000
	Total Liabilities and Shareholders’ Equity	$290,000	$148,000

Additional 2017 information:
	Net income, $31,000
	Sold land for gain of $3,000
	Paid dividends of $8,000
	Issued $50,000 common stock to purchase building

Required:
Prepare Fancy Company's 2017 statement of cash flows using the indirect method.

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