E5-17B (Preparation of a Statement of Cash Flows and a Balance Sheet) Gonzalvo Corporation’s balance sheet at the end of 2013 included the following items.

E5-17B (Preparation of a Statement of Cash Flows and a Balance Sheet) Gonzalvo Corporation’s balance sheet at the end of 2013 included the following items.

Current assets                                       $282,000                         Current liabilities      $180,000

Land                                                              36,000                         Bonds payable            120,000

Building                                                      144,000                        Common stock            216,000

Equipment                                                 108,000                        Retained earnings        52,800

Accum. depr.—building                           (36,000)                         Total                           $568,800

Accum. depr.—equipment                      (13,200)

Patents                                                         48,000

Total                                                          $568,800

The following information is available for 2014.

1. Treasury stock was purchased at a cost of $13,200.

2. Cash dividends of $36,000 were declared and paid.

3. A long-term investment in stock was purchased for $19,200.

4. Current assets other than cash increased by $34,800. Current liabilities increased by $15,600.

5. Depreciation expense was $4,800 on the building and $10,800 on equipment.

6. Net income was $66,000.

7. Bonds payable of $60,000 were issued.

8. An addition to the building was completed at a cost of $32,400.

9. Patent amortization was $3,000.

10. Equipment (cost $24,000 and accumulated depreciation $9,600) was sold for $12,000.

Instructions

(a) Prepare a statement of cash flows for 2014.

(b) Prepare a balance sheet at December 31, 2014.