Question

The balance sheets for Plasma Screens Corporation, along with additional information, are provided below:

PLASMA SCREENS CORPORATION Balance Sheets December 31, 2021 and 2020
	2021				2020
Assets
Current assets:
Cash	$	107,800			$	118,100
Accounts receivable		80,000				94,500
Inventory		100,000				84,500
Prepaid rent		5,000				2,500
Long-term assets:
Land		505,000				505,000
Equipment		810,000				695,000
Accumulated depreciation		(433,000	)			(278,000	)
Total assets	$	1,174,800			$	1,221,600
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	104,000			$	89,500
Interest payable		6,300				12,600
Income tax payable		9,000				5,500
Long-term liabilities:
Notes payable		105,000				210,000
Stockholders' equity:
Common stock		725,000				725,000
Retained earnings		225,500				179,000
Total liabilities and stockholders' equity	$	1,174,800			$	1,221,600

Additional Information for 2021:

1. Net income is $74,000.
2. The company purchases $115,000 in equipment.
3. Depreciation expense is $155,000.
4. The company repays $105,000 in notes payable.
5. The company declares and pays a cash dividend of $27,500

Required:
Prepare the statement of cash flows using the indirect method. (List cash outflows and any decrease in cash as negative amounts.)

Answer 1