Question 12 A comparative balance sheet for Rocker Company appears below: ROCKER COMPANY Comparative Balance Sheet Dec. 31, 2020 Dec. 31,...

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Accounting

Question 12
A comparative balance sheet for Rocker Company appearsbelow:
ROCKER COMPANY
Comparative Balance Sheet
Dec. 31, 2020 Dec. 31, 2019
Assets
Cash $34,000 $11,000
Accounts receivable 18,000 13,000
Inventory 25,000 17,000
Prepaid expenses 6,000 9,000
Long-term investments 0 17,000
Equipment 60,000 33,000
Accumulated depreciation—equipment (20,000 ) (15,000 )
Total assets $123,000 $85,000
Liabilities and Stockholder'sEquity
Accounts payable $17,000 $7,000
Bonds payable 36,000 45,000
Common stock 40,000 23,000
Retained earnings 30,000 10,000
Total liabilities and stockholders'equity $123,000 $85,000
Additional information:
1. Net income for the year ending December 31, 2020 was$35,000.
2. Cash dividends of $15,000 were declared and paid during theyear.
3. Long-term investments that had a cost of $17,000 were sold for$14,000.
4. Sales for 2020 were $120,000.

*Prepare a statement of cash flows for the year endedDecember 31, 2020, using the indirect method. (Show amounts thatdecrease cash flow with either a - sign e.g. -15,000 or inparenthesis e.g. (15,000).)

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Answer Rocker Company STATEMENT OF CASH FLOWS USING INDIRECT METHOD FOR THE YEAR ENDED 2020 Particulars Amount Cash flow from operating activities Net Income 35000 Adjustments to See Answer

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ROCKER COMPANY Comparative Balance Sheet
		Dec. 31, 2020		Dec. 31, 2019
	Assets
Cash		$34,000		$11,000
Accounts receivable		18,000		13,000
Inventory		25,000		17,000
Prepaid expenses		6,000		9,000
Long-term investments		0		17,000
Equipment		60,000		33,000
Accumulated depreciation—equipment		(20,000	)	(15,000	)
Total assets		$123,000		$85,000
Liabilities and Stockholder'sEquity
Accounts payable		$17,000		$7,000
Bonds payable		36,000		45,000
Common stock		40,000		23,000
Retained earnings		30,000		10,000
Total liabilities and stockholders'equity		$123,000		$85,000

Additional information:
1.		Net income for the year ending December 31, 2020 was$35,000.
2.		Cash dividends of $15,000 were declared and paid during theyear.
3.		Long-term investments that had a cost of $17,000 were sold for$14,000.
4.		Sales for 2020 were $120,000.