exercise

Question

Exercise 23-12
Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.
FAIRCHILD COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2012 AND 2011
		2012			2011
Cash		$1,805			$1,096
Receivables		1,741			1,290
Inventory		1,590			1,917
Plant assets		1,890			1,693
Accumulated depreciation		(1,191	)		(1,170	)
Long-term investments (held-to-maturity)		1,302			1,474
		$7,137			$6,300
Accounts payable		$1,202			$799
Accrued liabilities		216			234
Bonds payable		1,404			1,647
Common stock		1,900			1,701
Retained earnings		2,415			1,919
		$7,137			$6,300
FAIRCHILD COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2012
Sales		$6,818
Cost of goods sold		4,693
Gross margin		2,125
Selling and administrative expenses		920
Income from operations		1,205
Other revenues and gains
Gain on sale of investments		92
Income before tax		1,297
Income tax expense		540
Net income		$757
Additional information:
During the year, $74 of common stock was issued in exchange for plant assets. No plant assets were sold in 2012. Cash dividends were $261.
Prepare a statement of cash flows using the direct method. (If an amount reduces the account balance then enter with negative sign.)
	FAIRCHILD COMPANY
	Statement of Cash Flows
	For the Year Ended December 31, 2012
	(Direct Method)
Cash flows from operating activities
Cash collected from customers
Less: Cash paid for merchandise
Less: Cash paid for SG&A expenses
Less: Cash paid for income taxes
Net cash provided by operating activities
Cash flows from investing activities
Sale of held-to-maturity investments
Purchase of plant assets
Net cash provided by investing activities
Cash flows from financing activities
Issuance of capital stock
Retirement of bonds payable
Payment of cash dividends
Net cash used by financing activities
Net increase in cash
Cash, January 1, 2010
Cash, December 31, 2010
Non cash Investing & Financing Activities
Issurance of Common stock for Plant Assets