Question

The following are the financial statements of Nosker Company.

A.Prepare a statement of cash flows using the indirect method.

NOSKER COMPANY Comparative Balance Sheets December 31
Assets		2020			2019
Cash		$35,550			$20,750
Accounts receivable		32,300			19,250
Inventory		26,000			20,100
Equipment		59,500			77,200
Accumulated depreciation—equipment		(29,250	)		(23,600	)
Total		$124,100			$113,700
Liabilities and Stockholders’ Equity
Accounts payable		$28,700			$ 16,050
Income taxes payable		7,050			8,350
Bonds payable		27,700			32,300
Common stock		17,750			14,150
Retained earnings		42,900			42,850
Total		$124,100			$113,700

NOSKER COMPANY Income Statement For the Year Ended December 31, 2020
Sales revenue		$241,500
Cost of goods sold		175,650
Gross profit		65,850
Operating expenses		24,250
Income from operations		41,600
Interest expense		3,450
Income before income taxes		38,150
Income tax expense		9,000
Net income		$29,150

Additional data:

1.		Dividends declared and paid were $29,100.
2.		During the year, equipment was sold for $8,500 cash. This equipment cost $17,700 originally and had a book value of $8,500 at the time of sale.
3.		All depreciation expense, $14,850, is in the operating expenses.
4.		All sales and purchases are on account.

Answer 1