KRUG INC.
Comparative Balance Sheets
December 31, 2012 and 2011
2012 2011
Assets
Cash $ 26,400 $ 30,550
Accounts receivable, net 14,050 12,150
Inventory 90,100 70,150
Equipment 49,900 44,500
Accum. depreciation”Equipment (22,500 ) (18,300 )
Total assets $ 157,950 $ 139,050
Liabilities and Equity
Accounts payable $ 23,350 $ 25,400
Salaries payable 1,050 600
Common stock, no par value 107,000 100,000
Retained earnings 26,550 13,050
Total liabilities and equity $ 157,950 $ 139,050
KRUG INC.
Income Statement
For Year Ended December 31, 2012
Sales $ 47,575
Cost of goods sold (17,950 )
Gross profit 29,625
Operating expenses
Depreciation expense $ 4,200
Other expenses 8,550
Total operating expense 12,750
Income before taxes 16,875
Income taxes expense 3,375
Net income $ 13,500
Additional Information
a. No dividends are declared or paid in 2012.
b. Issued additional stock for $7,000 cash in 2012.
c. Purchased equipment for cash in 2012; no equipment was sold in 2012.
1. Use the above financial statements and additional information to prepare a statement of cash flows for the year ended December 31, 2012, using the indirect method. (Amounts to be deducted should be indicated with a minus sign. Omit the “$” sign in your response.)