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Erisa Magambo Company

Price: $1.99


Comparative balance sheets for Erisa Magambo Company are presented below.


Erisa Magambo COMPANY
Comparative Balance Sheets
31-Dec
 
Assets 2014 2013
Cash   58,000  22,000
Accounts receivable   85,000  76,000
Inventory   180,000  187,000
Land   75,000  100,000
Equipment   250,000  200,000
Accumulated depreciation - equip.  (66,000)  (42,000)
 Total   582,000  543,000
Liabilities and Stockholders’ Equity
Accounts payable   34,000  45,000
Bonds payable   150,000  200,000
Common stock ($1 par)   214,000  164,000
Retained earnings   184,000  134,000
 Total   582,000  543,000

Additional information:
1. Net income for 2014 was $120,000.
2. Cash dividends of $70,000 were declared and paid.
3. Bonds payable amounting to $50,000 were redeemed for cash $50,000.
4. Common stock was issued for $50,000 cash.
5. Depreciation expense was $24,000.
6. Sales for the year were $978,000.

Instructions
Prepare a worksheet for a statement of cash flows for 2014 using the indirect method. Enter
the reconciling items directly on the worksheet, using letters to cross-reference each entry.

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