Problem:
Plank Company
Comparative Balance Sheet
December 31
2004 2003
Cash $ 64,000 $ 36,000
Accounts receivable, net 53,000 57,000
Inventory 171,000 123,000
Land 180,000 285,000
Building 300,000 300,000
Accumulated depreciation (75,000) (60,000)
Equipment 1,545,000 900,000
Accumulated depreciation (177,000) (141,000)
$2,061,000 $1,500,000
Accounts payable $ 172,000 $ 150,000
Bonds payable 480,000 -0-
Capital stock, $10 par 1,125,000 1,125,000
Retained earnings 284,000 225,000
$2,061,000 $1,500,000
Additional Data:
1. Net income for the year amounted to $104,000.
2. Cash dividends were paid amounting to 4% of par value.
3. Land was sold for $120,000.
4. Plank sold equipment, which cost $225,000 and had accumulated depreciation of $90,000, for $105,000.
Instructions:
Prepare a statement of cash flows using the indirect method.