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Question 30 (15 points) Following are selected balance sheet accounts of Chocolate Bakery at December 31, 2013 and 2012, and the increases or...

Question 30 (15 points)

Following are selected balance sheet accounts of Chocolate Bakery at December 31, 2013 and 2012, and the increases or decreases in each account from 2012 to 2013. Also presented is selected income statement information for the year ended December 31, 2013, and additional information.

                                                                                                        Increase

Selected balance sheet accounts                   2013               2012      (Decrease)

Assets:

     Accounts receivable                          $  34,000          $ 24,000       $10,000

     Property, plant, and equipment             277,000            247,000         30,000

     Accumulated depreciation                   (178,000)         (167,000)      (11,000)


Liabilities and stockholders' equity:

     Bonds payable                                      49,000             46,000          3,000

     Dividends payable                                   8,000               5,000          3,000

     Common stock, $1 par                           22,000             19,000          3,000

     Additional paid-in capital                          9,000               3,000          6,000

     Retained earnings                               104,000             91,000         13,000

Selected income statement information for the year ended December 31, 2013

Sales revenue                                         $155,000

Depreciation                                               33,000

Gain on sale of equipment                           13,000

Net income                                                28,000

Additional information

•  Accounts receivable relate to sales of merchandise.

•  During 2013, equipment costing $40,000 was sold for cash.

•  During 2013, $20,000 of bonds payable were issued in exchange for property, plant, and equipment. There was no amortization of bond discount or premium.


Required:

Part A:

Items 1 through 4 represent activities that will be reported in Chocolate Bakery's statement of cash flows for the year ended December 31, 2013. For each item, determine the amount that should be reported in Chocolate Bakery's 2013 statement of cash flows. Use positive numbers for inflows and negative numbers for outflows. Also indicate which section (Operating, Investing, or Financing) of the statement of cash flow each item would be reported in. 

                                                                                              Amount          Category

1.  Payments for purchase of property, plant, and                             

equipment.                                                                        _______         _______

2.  Proceeds from sale of equipment.                                        _______         _______

3.  Cash dividends paid.                                                           _______         _______

4.  Redemption of bonds payable.                                             _______         _______



Part B:

Create the statement of Cash flows for Chocolate Bakery for the year ended December 13, 2013. Use the indirect method.

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