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ACC 302 Statement of Cash Flows Handout 1 04/13/11

ACC 302 Statement of Cash Flows Project

Use the comparative balance sheet and the comparative income statement on the following page to complete this

assignment.

Prepare the following documents: o Schedules showing the amount and percentage change from 2008 to 2009 for the comparative income

statements and the balance sheets

o Common-size income statements and balance sheets for 2008 and 2009 o A 2009 Statement of Cash Flows using the indirect method (Financials needed are the comparative balance

sheet and the comparative income statement on page two of this document. No additional information is needed.)

Write a 200–300 word memo that presents your analysis of the documents prepared. Your analysis should include: o The favorable and unfavorable changes in the components and composition of the statements prepared o The significant changes from Operating Activities, Investing Activities, and Financing Activities

Submit your assignment via MyWest. This assignment will be graded according to West’s  Accounting Project Rubric.

ACC 302 Statement of Cash Flows Handout 2 04/13/11

2009 2008 Cash 40,000 $ 24,000 $ Accounts receivable (net) 48,000 41,500 Inventory 43,000 34,500 Prepaid expenses 19,000 15,000

Total Current Assets 150,000 $ 115,000 $ Plant and equipment 67,000 $ 61,000 $ Less accumulated depreciation (41,000) (23,000) Plant and equipment (net) 26,000 $ 38,000 $ Long-term investments 90,000 89,000

Total Assets 266,000 $ 242,000 $ Accounts payable 13,000 $ 11,000 $ Accrued liabilities 55,000 71,000

Total Current Liabilities 68,000 $ 82,000 $ Long-term debt 25,000 8,000 Deferred taxes 4,000 3,500

Total Liabilities 97,000 $ 93,500 $ Common stock ($1 par) and additional paid-in capital 112,000 97,000 Retained earnings 57,000 51,500

Total Liabilities and Equity 266,000 $ 242,000 $

2009 2008 Sales 155,000 $ 125,000 $

Cost of goods sold 83,000 62,500 Gross profit 72,000.00 $ 62,500 $

Selling and administrative 45,700 37,500 Depreciation 18,000 16,800

Operating Profit 8,300 $ 8,200 $ Interest expense 2,000 1,327

Earnings before tax 6,300 $ 6,873 $ Tax expense 800 873 Net Income 5,500 $ 6,000 $

Comparative Income Statement

Comparative Balance Sheet

ACC 302 Statement of Cash Flows Handout 3 04/13/11

2009 2008 Cash 40,000 $ 24,000 $ Accounts receivable (net) 48,000 41,500 Inventory 43,000 34,500 Prepaid expenses 19,000 15,000

Total Current Assets 150,000 $ 115,000 $ Plant and equipment 67,000 $ 61,000 $ Less accumulated depreciation (41,000) (23,000) Plant and equipment (net) 26,000 $ 38,000 $ Long-term investments 90,000 89,000

Total Assets 266,000 $ 242,000 $ Accounts payable 13,000 $ 11,000 $ Accrued liabilities 55,000 71,000

Total Current Liabilities 68,000 $ 82,000 $ Long-term debt 25,000 8,000 Deferred taxes 4,000 3,500

Total Liabilities 97,000 $ 93,500 $ Common stock ($1 par) and additional paid-in capital 112,000 97,000 Retained earnings 57,000 51,500

Total Liabilities and Equity 266,000 $ 242,000 $

2009 2008 Sales 155,000 $ 125,000 $

Cost of goods sold 83,000 62,500 Gross profit 72,000.00 $ 62,500 $

Selling and administrative 45,700 37,500 Depreciation 18,000 16,800

Operating Profit 8,300 $ 8,200 $ Interest expense 2,000 1,327

Earnings before tax 6,300 $ 6,873 $ Tax expense 800 873 Net Income 5,500 $ 6,000 $

Comparative Income Statement

Comparative Balance Sheet