Case Study

Preparing Statement of Cash Flows 

Boscia Corporation's balance sheet appears below: 

                                       Comparative Balance Sheet 

                                                          Ending Balance           Beginning Balance 

Assets: 

Cash and cash equivalents......................... $ 44                             $ 38 

Accounts receivable ..................................     82                               69 

Inventory ...................................................     71                               69 

Plant and equipment ..................................    537                            500 

Accumulated depreciation.........................    ( 240)                         ( 201) 

Total assets................................................    $494                         $475 

Liabilities and stockholders’ equity: 

Accounts payable ......................................   $ 70                           $ 60 

Wages payable...........................................      24                              21 

Taxes payable ............................................     19                              22 

Bonds payable ...........................................     226                            300 

Deferred taxes............................................      19                              18 

Common stock...........................................       22                              20 

Retained earnings......................................      114                             34 

Total liabilities and stockholders’ equity ..       $494                         $475 

The net income for the year was $108. Cash dividends were $28. 

Required: Prepare a statement of cash flows in good form using the indirect method.