Question - Smith Corporation had the following comparative balance sheet information for 2012 and 2013:
|
Account
|
2013
|
2012
|
|
Cash
|
$ 60,000
|
$ 56,000
|
|
Accounts Receivable
|
96,000
|
100,000
|
|
Inventory
|
316,000
|
312,000
|
|
Prepaid Insurance
|
20,000
|
16,000
|
|
Property, Plant & Equipment
|
140,000
|
120,000
|
|
Accumulated Depreciation
|
(28,000)
|
(20,000)
|
|
Total
|
$ 604,000
|
$ 584,000
|
|
|
|
|
Accounts Payable
|
$ 28,000
|
$ 36,000
|
|
Bonds Payable
|
180,000
|
240,000
|
|
Common Stock
|
280,000
|
240,000
|
|
Retained Earnings
|
116,000
|
68,000
|
|
Total
|
$ 604,000
|
$ 584,000
|
The company reported net income for 2013 of $80,000. No property, plant & equipment was disposed of during the year. Smith paid $32,000 in cash dividends during 2013. Smith uses the indirect method to prepare the statement of cash flows.
Required: Prepare and explain Smith's Statement of Cash Flows for 2013.