AB 116 WEEK 10 PROBLEM 17-8A

AB 116 WEEK 10 Problem 17 8A
Presented below are the financial statements of Nosker Company.
NOSKER COMPANY
Comparative Balance Sheets
December 31
Assets		2014		2013
Cash		$35,500			$20,500	
Accounts receivable		32,720			18,840	
Inventory		26,870			20,800	
Equipment		59,150			77,210	
Accumulated depreciation—equipment		(29,980	)		(23,980	)
   Total		$124,260			$113,370	
						
Liabilities and Stockholders’ Equity						
Accounts payable		$28,370			$ 16,890	
Income taxes payable		7,400			8,390	
Bonds payable		26,620			32,960	
Common stock		18,680			13,870	
Retained earnings		43,190			41,260	
   Total		$124,260			$113,370	

NOSKER COMPANY
Income Statement
For the Year Ended December 31, 2014
Sales revenue		$242,620
Cost of goods sold		176,660
Gross profit		65,960
Operating expenses		24,930
Income from operations		41,030
Interest expense		2,110
Income before income taxes		38,920
Income tax expense		7,990
Net income		$30,930

Additional data:
1.		Dividends declared and paid were $29,000.
2.		During the year equipment was sold for $7,840 cash. This equipment cost $18,060 originally and had a book value of $7,840 at the time of sale.
3.		All depreciation expense, $16,220, is in the operating expenses.
4.		All sales and purchases are on account.

Further analysis reveals the following.
1.		Accounts payable pertain to merchandise suppliers.
2.		All operating expenses except for depreciation were paid in cash.



	 
 
 	 
 	Your answer is correct. 
 	 
Prepare a statement of cash flows for Nosker Company using the direct method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)