Working Backwards from Operating Cash Flow to an Income Statement
Thornton Inc. had the following operating balances for 2008:
|
|
December 31, 2008 |
January 1, 2008 |
|
Accounts Payable |
$58,200 |
$61,500 |
|
Inventory |
39,400 |
37,300 |
|
Accounts Receivable |
87,000 |
89,100 |
|
Prepaid Expenses |
12,500 |
14,100 |
Additional information for Thornton is as follows:
(a) All purchases of inventory were on account.
(b) Depreciation Expense of $96,000 was recognized during 2008.
(c) Equipment was sold during 2008, and a gain of $3,000 was recognized.
Thornton provides the following cash flow information for 2008:
|
Cash collected from customers |
$950,000 |
|
Cash paid for inventory |
(410,000) |
|
Cash paid for or other expenses |
(139,000) |
|
Cash from operations |
$401,000 |
Prepare an income statement for Thornton for 2008.