Chapter 9, Problem 9.28P

Problem 9.28

LO 10. 11

Complete balance sheet and prepare a statement of changes in retained earnings Following is a statement of cash flows (indirect method) for Hartford, Inc., for the year ended December 31, 2017. Also shown is a partially completed comparative balance sheet as of December 31. 2017 and 2016:

HARTFORD, INC.

Statement of Cash Flows

For the Year Ended December 31, 2017 Cash Flows from Operating Activities: Net Income $ 54,000 Add (deduct) items not affecting cash: Depreciation expense 270,000 Decrease in accounts receivable 138,000 Increase in inventory (42,000) Increase in notes payable 72,000 Decrease in accounts payable (36.000) Net cash provided by operating activities $ 456,000 Cash Flows from Investing Activities: Purchase of equipment $ (300,000) Purchase of buildings (288.000) Net cash used by investing activities $ (588.000) Cash Flows from Financing Activities: Proceeds from short-term debt $

30,000 Cash used for retirement of long-term debt (150,000) Proceeds from issuance of common stock 60,000 Payment of cash dividends on common stock (18,000) Net cash used by financing activities $ (78.000) Net decrease in cash for the year $ (210.000)

Required:

1. Complete the December 31, 2017 and 2016 balance sheets.
2. Prepare a statement of changes in retained earnings for the year ended December 31, 2017.