Problem:
Preparation of Statement of Cash Flows
Below is the income statement and balance sheet of Closely Held Corporation. From this information prepare a statement of cash flows for the year ended September 30, 2005.
Income Statement for year ended September 30,
(in thousands)
2004 2005
Revenues $500,000 $512,000
Cost of Sales (395,000) (404,480)
Gross Margin 105,000 107,520
Selling and Administrative (60,000) (61,440)
Income before interest and taxes 45,000 46,080
Interest expense (9,900) (12,320)
Income before income taxes 35,100 33,760
Income tax (12,812) (12,322)
Net income $ 22,289 $ 21,438
Balance Sheet as of September 30,
(in thousands)
2004 2005 Change
Assets
Current Assets
Cash and equivalents $ 10,000 $ 10,240 $ 240
Accounts receivable 40,000 48,640 8,640
Inventories 39,500 56,627 17,127
Prepaid expenses 10,000 11,000 1,000
Total Current Assets 99,500 126,507 27,007
Property, plant, and equipment 390,000 411,000 21,000
Accumulated depreciation (233,000) (250,000) (17,000)
P, P & E net 157,000 161,000 4,000
Other Assets, net amortization 27,000 26,000 (1,000)
Total Assets $283,500 $313,507 $ 30,007
Liabilities and Shareholders? Equity
Current Liabilities
Current portion of long-term debt $12,000 $ 13,000 $ 1,000
Notes payable 30,000 31,000 1,000
Accounts payable 39,500 42,450 2,950
Accrued liabilities 21,569 18,000 (3,569)
Income taxes payable 8,900 9,500 600
Total Current Liabilities 111,969 113,950 1,981
Long-term debt 87,000 99,000 12,000
Non-current deferred income tax 10,000 9,070 (30)
Other non-current liabilities 4,340 5,000 660
Shareholders? Equity
Common stock ? Class A 3,000 3,500 500
Capital in excess of par 21,000 26,000 5,000
Retained earnings 46,191 56,087 9,896
Total Shareholders? Equity 70,191 85,587 15,396
Total Liabilities and Equity $283,500 $313,507 $ 30,007