Question: Biven Corporation's balance sheet and income statement appear below:
| BALANCE SHEETS |
|
|
|
|
2006 |
2005 |
| ASSETS |
| Cash & equivalents |
$ 35,000 |
$ 30,000 |
| Accounta receivable |
54,000 |
49,000 |
| Inventory |
67,000 |
58,000 |
| Plant & equipment |
580,000 |
530,000 |
| Accumulated depreciation |
(316,000) |
(313,000) |
| Total Assets |
$ 420,000 |
$ 354,000 |
|
|
|
| LIABILITIES & EQUITIES |
| Accounts payable |
$ 51,000 |
$ 57,000 |
| Wages payable |
26,000 |
24,000 |
| Taxes payable |
11,000 |
10,000 |
| Deferred taxes payable |
25,000 |
24,000 |
| Bonds payable (long term) |
77,000 |
90,000 |
| Total liabilities |
190,000 |
205,000 |
| Common stock |
33,000 |
30,000 |
| Retained earnings |
197,000 |
119,000 |
| Total equities |
230,000 |
149,000 |
| Total liabilities & equities |
$ 420,000 |
$ 354,000 |
|
|
|
| INCOME STATEMENTS |
|
2006 |
2005 |
| Sales |
$ 620,000 |
$ 520,000 |
| Cost of goods sold |
381,000 |
300,000 |
| Gross margin |
239,000 |
220,000 |
| Selling & Admin expense |
103,000 |
99,000 |
| Net operating income |
136,000 |
121,000 |
| Gain on sale of plant & equipment |
20,000 |
- |
| Income before tax |
156,000 |
121,000 |
| Income tax |
47,000 |
36,000 |
| Net income |
$ 109,000 |
$ 85,000 |
Cash dividends were $31,000. The company sold equipment for $20,000.
The equipment had originally cost $14,000 and was fully depreciated.
Required:
Prepare a statement of cash flows for 2006 using the indirect and direct methods.