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The comparative balance sheets for Drake Company appear below:
Drake, Inc.
Comparative Balance Sheets
December 31
Assets 2014 2013
Cash 41,000 35,000
Accounts Receivable 75,000 53,000
Inventories 120,000 132,000
Prepaid Expenses 19,000 25,000
Investments 100,000 75,000
Plant assets 325,000 250,000
Accumulated Depreciation (65,000)
(60,000)
Total Assets 615,000
510,000
Liabilities & Equity
Accounts Payable 93,000 75,000
Accrued Expenses 29,000 24,000
Bonds Payable 120,000 160,000
Common Stock 275,000 170,000
Retained Earnings 98,000
81,000
Total Liabilities & Equity 615,000 510,000
Drake, Inc.
Income Statement
For the Year Ended December 31, 2014
Sales 450,000
Cost of Goods Sold 300,000
Gross Margin 150,000
Less:
Operating Expenses 60,000
Depreciation Expense 17,000
Income Taxes 20,000
Interest Expense 18,000
Loss on sale of plant assets 3,000 118,000
Net Income 32,000
Additional information
1. New plant assets costing $100,000 were purchased with cash.
2. Investments were purchased with cash.
3. Old plant assets costing $25,000 and with a book value of $13,000 were sold for $10,000 cash.
4. Bonds with a face value of $40,000 were converted into $40,000 par value of common stock.
5. Common stock was issued for cash.
6. A cash dividend of $15,000 was declared and paid during the year.
Required
Prepare a statement of cash flows for the year using the indirect method.
