Preparing the statement of cash flows-indirect method
Accountants for Smithson, Inc., have assembled the following data for the year ended December 31, 2012:
|
December 31,
|
|
2012
|
2011
|
|
Current Accounts:
|
|
|
|
Current assets:
|
|
|
|
Cash and cash equivalents
|
$ 106,100
|
$ 26,000
|
|
Accounts receivable
|
64,300
|
68,900
|
|
Inventories
|
80,000
|
75,000
|
|
Current liabilities:
|
|
|
|
Accounts payable
|
57,700
|
56,100
|
|
Income tax payable
|
14,500
|
17,000
|
|
|
|
|
Transaction Data for 2012:
|
|
|
|
Issuance of common stock for cash
|
$ 45,000
|
|
|
Depreciation expense
|
18,000
|
|
|
Purchase of equipment
|
70,000
|
|
|
Acquisition of land by issuing long-term note payable
|
113,000
|
|
|
Payment of note payable
|
$46,100
|
|
|
Payment of cash dividends
|
52,000
|
|
|
Issuance of note payable to borrow cash
|
68,000
|
|
|
Gain on sale of building
|
3,500
|
|
|
Net income
|
68,500
|
|
|
Cost basis of building sold
|
$50,000
|
|
Requirement
1. Prepare Smithson's statement of cash flows using the indirect method. Include an accompanying schedule of noncash investing and financing activities.