Preparing and interpreting a statement of cash flows using a T-account work sheet. Financial statement data for Dickerson Manufacturing Company for the current year appear in Exhibit 5.29. Additional information inc1udei the following

(1) Net income for the year was $568,000; dividends declared and paid were $60,000.

(2) Depredation expense for the year was $510,000 on buildings and m4chinery.

(3) The firm sold for $25,000 machinery originally costing $150,000 with accumulated depreciation of $120,000.

(4) The firm retired bonds during the year at their book value.

a. Prepare a statement of cash flows for Dickerson Manufacturing Company for the year using the indirect method to compute cash flow from operations. Support the statement with a T-account work sheet.

b. Comment on the pattern of cash flows from operating, investing, and financingactivities.

Dickerson Manufacturing Company Comparative Balance Sheet (Problem 35) EXHIBIT 5.29 aary 1 December 31 ASSETS Current Assets Cash. $ 358,000 $ 324,000 Accounts Receivable 946,000 1,052,000 Inventory 1,004,000 1,208,000 $ 2,584,000 Tatal Current Assets. $2,308,000 Noncurrent Assets $ 594,000 $ 630,000 Land.. Buildings and Machinery Less Accumulated Depreciation. B,678,000 9,546,000 (3,974,000) $ 5,298,000 $ 7,606,000 (4,364,000) $ 5,812,000 $ 8,396,000 Tatal Noncurrent Assets Tatal Assets ... LIABILITIES AND SHAREHOLDERS EQUITY Current Liabilities $ 412,000 Accounts Payable . Taxes Payable $ 558,000 274,000 290,000 Other Short-Term Payables 588,000 726,000 $ 1,274,000 Tatal Current Liabilities $ 1,574,000 Noncurrent Liabilities Bonds Payable. 1,934,000 $ 3,508,000 1,984.000 $ 3,258,000 Total Liabilities. Shareholders' Equity Common Stock... Retained Earnings Total Shareholders' Equity Total Liabilities and Shareholders' Equity $ 1,672,000 $ 1,704,000 2,676,000 3,184,000 5 4,348,000 $ 7,606,000 $ 4,888,000 $ 8,396,000