Home Free Inc. had the following financial information for 2013. Â Prepare the statement of cash flows using the indirect method for the operating section. Â Briefly analyze the statement -- what do you learn from it?
Additional information: Â No new equipment was purchased in 2013 and new stock was issued for cash. Â Dividends were paid in Cash. Â The building was purchased with cash. Â The original cost of the equipment sold was $26,200.
| Home Free, Inc. Income Statement For Year Ended December 31, 2013 | ||
|---|---|---|
| Â | Â | Â |
| Revenue: | Â | Â |
| Â Sales Revenue | Â | 255,000 |
| Â | Â | Â |
| Expenses: | Â | Â |
| Depreciation Expense | 32,000 | Â |
| Salaries Expense | 96,000 | Â |
| Rent Expense | 24,500 | Â |
| Utilities Expense | 5,900 | Â |
| Gain on Sale of Equipment | 800 | Â |
| Â Total Expenses | Â | 159,200 |
| Â | Â | Â |
| Net Income | Â | 95,800 |
Â
| Home Free, Inc. Balance Sheet December 31, 2013 | ||||||
|---|---|---|---|---|---|---|
| Â | Â | Â | Â | Â | Â | Â |
| Assets: | 2013 | 2012 | Â | Liabilities & Equity: | 2013 | 2012 |
| Cash | 358,050 | 428,300 | Â | Accounts Payable | 11,500 | 19,000 |
| Accounts Receivable | 80,000 | 115,000 | Â | Taxes Payable | 3,700 | 2,150 |
| Supplies | 400 | 650 | Â | Â Total Current Liabilities | 15,200 | 21,150 |
| Inventory | 82,000 | 76,000 | Â | Long Term Notes Payable | Â - | 36,500 |
| Â Total Current Assets | 520,450 | 619,950 | Â | Â | Â | Â |
| Â | Â | Â | Â | Common Stock | 155,000 | 155,000 |
| Equipment | 71,000Â | 97,200Â | Â | Paid in capital in excess of par value, common stock | 285,000 | 285,000 |
| Less: Accum. Depreciation | (65,000) | (57,000) | Â | Â Total Paid in Capital | 440,000 | 440,000 |
| Building | 145,000 | - | Â | Â | Â | Â |
| Â Total Plant Assets | 6,000 | 40,200 | Â | Retained Earnings | 216,250 | 162,500 |
| Â | Â | Â | Â | Â | Â | Â |
| TOTAL ASSETS | 671,450 | 660,150 | Â | TOTAL LIABILITIES AND EQUITY | 671,450 | 660,150 |
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| Description | Amount | Total |
|---|---|---|
| Subcategory,Cash Flows from Operating Activities: | ||
| Subcategory,Adjustments to reconcile net income to net cash | ||
| Single line | Single line | |
| Total Adjustments | Single lineSingle line | |
| Single line | ||
| Subcategory,Cash Flows from Investing Activities: | ||
| Single line | Single line | |
| Single line | ||
| Subcategory,Cash Flows from Financing Activities: | ||
| Single line | Single line | |
| Single lineSingle line | ||
| Single line | ||
| Single line | ||
| Single line | ||
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