Operating Activities Analysis Exercises and Problems

Using the Balance Sheet and Income Statement data below, analyze the transactions for Tolito Treats, Inc. for 2013 and 2014.

	2013	2014
Cash	$34,000.00	$34,500.00
Accounts Receivable, Net	$12,000.00	$17,000.00
Inventory	$16,000.00	$14,000.00
Investments (Long Term)	$6,000.00	__
Fixed Assets	$80,000.00	$93,000.00
Accumulated Depreciation	-48,000	-$39,000.00
Total Assets	$100,000.00	$119,500.00
Accounts Payable	$19,000.00	$12,000.00
Bonds Payable	$10,000.00	$30,000.00
Common Stock	$50,000.00	$61,000.00
Retained Earnings	$21,000.00	$28,000.00
Treasury Stock	__	-$11,500.00
Total Liabilities and Equity	$100,000.00	$119,500.00

Additional data for the period January 1, 2014 through December 31, 2014 are:

1. Sales on account, $70,000.
2. Purchases on account, $40,000.
3. Depreciation, $5,000.
4. Expenses paid in cash, $18,000 (including $4,000 of interest and $6,000 in taxes).
5. Decrease in inventory, $2,000.
6. Sales of fixed assets for $6,000 cash; cost $21,000 and two-thirds depreciated (loss or gain is included in income).
7. Purchase of fixed assets for cash, $4,000.
8. Fixed assets are exchanged for bonds payable of $30,000.
9. Sale of investments for $9,000 cash.
10. Purchase of treasury stock for cash, $11,500.
11. Retire bonds payable by issuing common stock, $10,000.
12. Collections on accounts receivable, $65,000.
13. Sold unissued common stock for cash, $1,000.

Required:

1. In Excel, I need help to create a statement of cash flows (indirect method) for the year ended December 31, 2014.
2. In Excel, I need help to create a side-by-side comparative statement contrasting two bases of reporting: (1) net income and (2) cash flows from operations.