Condensed financial data of Odgers Inc. follow.
| ODGERS INC. Comparative Balance Sheets December 31 |
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| Assets | 2014 | 2013 | ||
| Cash | $ 141,400 | $ 84,700 | ||
| Accounts receivable | 153,650 | 66,500 | ||
| Inventory | 196,875 | 179,988 | ||
| Prepaid expenses | 49,700 | 45,500 | ||
| Long-term investments | 241,500 | 190,750 | ||
| Plant assets | 498,750 | 424,375 | ||
| Accumulated depreciation | (87,500 | ) | (91,000 | ) |
| Total | $1,194,375 | $900,813 | ||
| Liabilities and Stockholders’ Equity | ||||
| Accounts payable | $ 178,500 | $ 117,775 | ||
| Accrued expenses payable | 28,875 | 36,750 | ||
| Bonds payable | 192,500 | 255,500 | ||
| Common stock | 385,000 | 306,250 | ||
| Retained earnings | 409,500 | 184,538 | ||
| Total | $1,194,375 | $900,813 |
| ODGERS INC. Income Statement Data For the Year Ended December 31, 2014 |
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| Sales revenue | $679,805 | |
| Less: | ||
| Cost of goods sold | $237,055 | |
| Operating expenses, excluding depreciation | 21,718 | |
| Depreciation expense | 81,375 | |
| Income tax expense | 47,740 | |
| Interest expense | 8,278 | |
| Loss on disposal of plant assets | 13,125 | 409,291 |
| Net income | $ 270,514 |
Additional information:
| 1. | New plant assets costing $175,000 were purchased for cash during the year. |
| 2. | Old plant assets having an original cost of $100,625 and accumulated depreciation of $84,875 were sold for $2,625 cash. |
| 3. | Bonds payable matured and were paid off at face value for cash. |
| 4. | A cash dividend of $45,552 was declared and paid during the year. |
Prepare a statement of cash flows using the indirect method.(Show amounts that decrease cash flow with either a – sign e.g. -15,000 or in parenthesis e.g. (15,000).)
| ODGERS INC. Statement of Cash Flows For the Year Ended December 31, 2014 |
|
| Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash | |
| Purchase of Plant Assets Decrease in Accounts Receivable Decrease in Accrued Expenses Payable Sale of Common Stock Increase in Accounts Payable Payment of Cash Dividends Decrease in Accounts Payable Loss on Disposal of Plant Assets Redemption of Bonds Increase in Accrued Expenses Payable Depreciation Expense Increase in Prepaid Expenses Purchase of Investments Decrease in Prepaid Expenses Net Income Sale of Plant Assets Increase in Inventory Decrease in Inventory Increase in Accounts Receivable | $ |
| Adjustments to reconcile net income to | |
| Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash | |
| Purchase of Plant Assets Decrease in Accounts Payable Increase in Inventory Decrease in Prepaid Expenses Sale of Plant Assets Decrease in Accrued Expenses Payable Sale of Common Stock Increase in Accounts Receivable Increase in Accrued Expenses Payable Decrease in Inventory Net Income Increase in Prepaid Expenses Decrease in Accounts Receivable Increase in Accounts Payable Payment of Cash Dividends Redemption of Bonds Purchase of Investments Depreciation Expense Loss on Disposal of Plant Assets | $ |
| Purchase of Plant Assets Decrease in Accrued Expenses Payable Increase in Accrued Expenses Payable Increase in Accounts Receivable Decrease in Accounts Receivable Increase in Prepaid Expenses Decrease in Prepaid Expenses Net Income Increase in Inventory Sale of Common Stock Decrease in Accounts Payable Sale of Plant Assets Decrease in Inventory Loss on Disposal of Plant Assets Depreciation Expense Purchase of Investments Payment of Cash Dividends Redemption of Bonds Increase in Accounts Payable | |
| Purchase of Plant Assets Decrease in Inventory Redemption of Bonds Payment of Cash Dividends Net Income Depreciation Expense Decrease in Prepaid Expenses Increase in Accounts Payable Sale of Common Stock Decrease in Accounts Receivable Sale of Plant Assets Increase in Accounts Receivable Decrease in Accounts Payable Purchase of Investments Loss on Disposal of Plant Assets Increase in Inventory Decrease in Accrued Expenses Payable Increase in Accrued Expenses Payable Increase in Prepaid Expenses | |
| Loss on Disposal of Plant Assets Decrease in Accrued Expenses Payable Purchase of Investments Sale of Plant Assets Redemption of Bonds Increase in Accounts Payable Decrease in Prepaid Expenses Increase in Accounts Receivable Decrease in Accounts Receivable Decrease in Accounts Payable Net Income Increase in Accrued Expenses Payable Sale of Common Stock Payment of Cash Dividends Depreciation Expense Increase in Prepaid Expenses Increase in Inventory Decrease in Inventory Purchase of Plant Assets | |
| Net Income Payment of Cash Dividends Depreciation Expense Purchase of Plant Assets Increase in Accounts Payable Redemption of Bonds Increase in Inventory Purchase of Investments Decrease in Accounts Payable Increase in Accounts Receivable Loss on Disposal of Plant Assets Decrease in Inventory Sale of Common Stock Decrease in Accounts Receivable Decrease in Accrued Expenses Payable Increase in Accrued Expenses Payable Increase in Prepaid Expenses Decrease in Prepaid Expenses Sale of Plant Assets | |
| Increase in Accrued Expenses Payable Increase in Accounts Payable Increase in Prepaid Expenses Decrease in Accounts Payable Redemption of Bonds Loss on Disposal of Plant Assets Decrease in Prepaid Expenses Net Income Increase in Inventory Depreciation Expense Decrease in Accrued Expenses Payable Decrease in Inventory Increase in Accounts Receivable Sale of Plant Assets Decrease in Accounts Receivable Purchase of Investments Purchase of Plant Assets Sale of Common Stock Payment of Cash Dividends | |
| Decrease in Accounts Payable Net Income Decrease in Accounts Receivable Depreciation Expense Increase in Accrued Expenses Payable Purchase of Investments Decrease in Inventory Loss on Disposal of Plant Assets Decrease in Accrued Expenses Payable Increase in Prepaid Expenses Decrease in Prepaid Expenses Increase in Accounts Payable Increase in Inventory Increase in Accounts Receivable Payment of Cash Dividends Sale of Plant Assets Purchase of Plant Assets Sale of Common Stock Redemption of Bonds | |
| Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash | |
| Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash | |
| Payment of Cash Dividends Increase in Accounts Receivable Increase in Accounts Payable Decrease in Prepaid Expenses Decrease in Accrued Expenses Payable Increase in Prepaid Expenses Depreciation Expense Decrease in Accounts Payable Increase in Inventory Increase in Accrued Expenses Payable Decrease in Inventory Net Income Redemption of Bonds Decrease in Accounts Receivable Loss on Disposal of Plant Assets Sale of Plant Assets Purchase of Investments Purchase of Plant Assets Sale of Common Stock | |
| Sale of Common Stock Redemption of Bonds Decrease in Prepaid Expenses Increase in Inventory Increase in Prepaid Expenses Decrease in Accrued Expenses Payable Purchase of Plant Assets Increase in Accrued Expenses Payable Decrease in Inventory Decrease in Accounts Payable Sale of Plant Assets Loss on Disposal of Plant Assets Increase in Accounts Receivable Increase in Accounts Payable Purchase of Investments Decrease in Accounts Receivable Payment of Cash Dividends Net Income Depreciation Expense | |
| Redemption of Bonds Payment of Cash Dividends Decrease in Accounts Payable Increase in Inventory Increase in Accounts Payable Sale of Plant Assets Purchase of Plant Assets Loss on Disposal of Plant Assets Decrease in Inventory Net Income Sale of Common Stock Depreciation Expense Increase in Accounts Receivable Increase in Accrued Expenses Payable Decrease in Accrued Expenses Payable Increase in Prepaid Expenses Purchase of Investments Decrease in Prepaid Expenses Decrease in Accounts Receivable | |
| Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash | |
| Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash | |
| Increase in Inventory Redemption of Bonds Sale of Common Stock Loss on Disposal of Plant Assets Decrease in Inventory Net Income Purchase of Plant Assets Decrease in Accounts Payable Increase in Accounts Receivable Decrease in Accrued Expenses Payable Payment of Cash Dividends Increase in Accrued Expenses Payable Depreciation Expense Increase in Accounts Payable Increase in Prepaid Expenses Decrease in Accounts Receivable Decrease in Prepaid Expenses Sale of Plant Assets Purchase of Investments | |
| Decrease in Inventory Sale of Plant Assets Redemption of Bonds Purchase of Plant Assets Decrease in Accounts Receivable Decrease in Prepaid Expenses Increase in Accrued Expenses Payable Payment of Cash Dividends Net Income Increase in Accounts Receivable Increase in Inventory Purchase of Investments Increase in Prepaid Expenses Decrease in Accrued Expenses Payable Depreciation Expense Sale of Common Stock Increase in Accounts Payable Decrease in Accounts Payable Loss on Disposal of Plant Assets | |
| Increase in Accrued Expenses Payable Increase in Inventory Decrease in Accounts Payable Decrease in Accounts Receivable Increase in Accounts Payable Depreciation Expense Loss on Disposal of Plant Assets Sale of Common Stock Increase in Prepaid Expenses Decrease in Inventory Decrease in Prepaid Expenses Increase in Accounts Receivable Decrease in Accrued Expenses Payable Sale of Plant Assets Purchase of Investments Purchase of Plant Assets Payment of Cash Dividends Redemption of Bonds Net Income | |
| Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash | |
| Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash | |
| Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash | |
| Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash |
