Wickersham Brothers Inc.is developing its annual financial statements at December 31,2014.The statements are complete except for the statement of cash flows.The completed comparative balance sheets and income statements are summarized. Additional Data:
a.Bought equipment for cash,$50,000.
b.Paid $10,000 on long-term note payable.
c.Issued new shares of stock for $20,000 cash.
d.Cash dividends of $16,000 were declared and paid.
e.Accounts payable are exclusively related to inventory purchases on credit.
f.Tax expense ($4,000)and interest expense ($3,000)were paid in full at the end of both years and are included in other expenses.
a.Prepare the statement of cash flows for 2014 using the indirect method.Include any supplemental disclosures.
b.Interpret the statement of cash flows by explaining the main sources and uses of cash during the year.

Question

Wickersham Brothers Inc.is developing its annual financial statements at December 31,2014.The statements are complete except for the statement of cash flows.The completed comparative balance sheets and income statements are summarized.  Additional Data:
a.Bought equipment for cash,$50,000.
b.Paid $10,000 on long-term note payable.
c.Issued new shares of stock for $20,000 cash.
d.Cash dividends of $16,000 were declared and paid.
e.Accounts payable are exclusively related to inventory purchases on credit.
f.Tax expense ($4,000)and interest expense ($3,000)were paid in full at the end of both years and are included in other expenses.
a.Prepare the statement of cash flows for 2014 using the indirect method.Include any supplemental disclosures.
b.Interpret the statement of cash flows by explaining the main sources and uses of cash during the year.

Quizplus · Accepted Answer

The Answer of Wickersham Brothers Inc.is developing its annual financial statements at December 31,2014.The statements are complete except for the statement of cash flows.The completed comparative balance sheets and income statements are summarized.  Additional Data:
a.Bought equipment for cash,$50,000.
b.Paid $10,000 on long-term note payable.
c.Issued new shares of stock for $20,000 cash.
d.Cash dividends of $16,000 were declared and paid.
e.Accounts payable are exclusively related to inventory purchases on credit.
f.Tax expense ($4,000)and interest expense ($3,000)were paid in full at the end of both years and are included in other expenses.
a.Prepare the statement of cash flows for 2014 using the indirect method.Include any supplemental disclosures.
b.Interpret the statement of cash flows by explaining the main sources and uses of cash during the year.