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Problem 13-7 Prepare a Statement of Cash Flows [LO13-1, LO13-2] [The following information applies to the...

Problem 13-7 Prepare a Statement of Cash Flows [LO13-1, LO13-2]

[The following information applies to the questions displayed below.]

Comparative financial statements for Weaver Company follow:

Weaver Company
Comparative Balance Sheet
at December 31
This
Year
Last
Year
Assets
Cash and cash equivalents $ 22 $ 11
Accounts receivable 292 230
Inventory 156 194
Prepaid expenses 8 5
Total current assets 478 440
Property, plant, and equipment 513 434
Less accumulated depreciation (81 ) (71 )
Net property, plant, and equipment 432 363
Long-term investments 25 32
Total assets $ 935 $ 835
Liabilities and Stockholders' Equity
Accounts payable $ 304 $ 224
Accrued liabilities 72 79
Income taxes payable 74 64
Total current liabilities 450 367
Bonds payable 200 171
Total liabilities 650 538
Common stock 161 201
Retained earnings 124 96
Total stockholders’ equity 285 297
Total liabilities and stockholders' equity $ 935 $ 835
Weaver Company
Income Statement
For This Year Ended December 31
Sales $ 755
Cost of goods sold 446
Gross margin 309
Selling and administrative expenses 220
Net operating income 89
Nonoperating items:
Gain on sale of investments $ 6
Loss on sale of equipment (2 ) 4
Income before taxes 93
Income taxes 25
Net income $ 68

During this year, Weaver sold some equipment for $19 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $7 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $40 of its own stock. This year Weaver did not retire any bonds.

1. Using the indirect method, determine the net cash provided by/used in operating activities for this year.

2. Using the information from Part 1, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. (List any deduction in cash and cash outflows as negative amounts.)

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