Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.
FAIRCHILD COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2012 AND 2011
| 2012 | 2011 | |
| Cash | 1,795 | 1,104 |
| Receivables | 1,753 | 1,290 |
| Inventory | 1,595 | 1,908 |
| Plant assets | 1,906 | 1,695 |
| Accumulated depreciation | (1,203) | (1,167) |
| Long-term investments (held-to-maturity) | 1,305 | 1,480 |
| $7,151 | $6,310 |
| Accounts payable | 1,215 | 789 |
| Accrued liabilities | 213 | 234 |
| Bonds payable | 1,414 | 1,636 |
| Common stock | 1,905 | 1,693 |
| Retained earnings | 2,404 | 1,958 |
| $7,151 | $7,151 |
FAIRCHILD COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2012
| Sales | 6,795 |
| Cost of goods sold | 4,694 |
| Gross margin | 2,101 |
| Selling and administrative expenses | 939 |
| Income from operations | 1,162 |
| Other revenues and gains | |
| Gain on sale of investments | 85 |
| Income before tax | 1,247 |
| Income tax expense | 531 |
| Net income | $716 |
Additional information:
During the year, $74 of common stock was issued in exchange for plant assets. No plant assets were sold in 2012. Cash dividends were $270.
Instructions:
Prepare a statement of cash flows using the indirect method. (If an amount reduces the account balance then enter negative sign)
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