Problem 21-16 Statement of cash flows; indirect method [LO21-4, 21-8]

Problem 21-16 Statement of cash flows; indirect method [LO21-4, 21-8]

The comparative balance sheets for 2013 and 2012 and the statement of income for 2013 are given below for Dux Company. Additional information from Dux's accounting records is provided also.

DUX COMPANY
Comparative Balance Sheets
December 31, 2013 and 2012
($ in 000s)
2013 2012
Assets
Cash $ 33 $ 20  
Accounts receivable 48 50  
Less: Allowance for uncollectible accounts (4) (3)  
Dividends receivable 3 2  
Inventory 55 50  
Long-term investment 15 10  
Land 70 40  
Buildings and equipment 225 250  
Less: Accumulated depreciation (25) (50)  

$ 420 $ 369  

Liabilities
Accounts payable $ 13 $ 20  
Salaries payable 2 5  
Interest payable 4 2  
Income tax payable 7 8  
Notes payable 30 0  
Bonds payable 95 70  
Less: Discount on bonds (2) (3)  
Shareholders' Equity
Common stock 210 200  
Paid-in capital—excess of par 24 20  
Retained earnings 45 47  
Less: Treasury stock (8) 0  

$ 420 $ 369  


DUX COMPANY
Income Statement
For Year Ended December 31, 2013
($ in 000s)
Revenues
Sales revenue $ 200  
Dividend revenue 3 $ 203  

Expenses
Cost of goods sold 120  
Salaries expense 25  
Depreciation expense 5  
Bad debt expense 1  
Interest expense 8  
Loss on sale of building 3  
Income tax expense 16 178  

Net income $ 25  


Additional information from the accounting records:
a. A building that originally cost $40,000, and which was three-fourths depreciated, was sold for $7,000.
b. The common stock of Byrd Corporation was purchased for $5,000 as a long-term investment.
c. Property was acquired by issuing a 13%, seven-year, $30,000 note payable to the seller.
d. New equipment was purchased for $15,000 cash.
e. On January 1, 2013, $25,000 of bonds were sold at face value.
f.

On January 19, Dux issued a 5% stock dividend (1,000 shares). The market price of the $10 par value common stock was $14 per share at that time.
g. Cash dividends of $13,000 were paid to shareholders.
h.

On November 12, 500 shares of common stock were repurchased as treasury stock at a cost of $8,000.

Required:

Prepare the statement of cash flows for Dux Company using the indirect method. (Do not round intermediate calculations. Enter your answers in thousands. Amounts to be deducted should be indicated with a minus sign.)