Preparing a statement of cash flows presents a comparative balance sheet for Gordon Corporation as of December 31, 2007 and 2008.
During 2008 the company declared and paid dividends of $120,000.
During 2008 the company disposed of buildings and equipment that originally cost $55,000 and had accumulated depreciation at the time of disposal of $30,000.
a. Prepare a T account work sheet for the preparation of the statement of cash flows for 2008 using the indirect method for cash flows from operations.
b. Derive a presentation for cash flows from operations using the format, but using a single panel.
c. Present a statement of cash flows for 2008 using the direct method for cash flows from operations and include a reconciliation of net income to cash flows from operations.