Question

roblem 4-11 Statement of cash flows; indirect method [LO4-9]

Presented below are the 2013income statement and comparative balance sheets for SantanaIndustries.

SANTANA INDUSTRIES Income Statement For the Year Ended December 31, 2013 ($ in thousands)
Sales revenue	$	15,250
Service revenue		4,400
Total revenue				$	19,650
Operatingexpenses:
Cost ofgoods sold		7,700
Selling		2,900
Generaland administrative		2,000
Total operating expenses					12,600
Operatingincome					7,050
Interestexpense					250
Income before incometaxes					6,800
Income taxexpense					3,000
Net income				$	3,800

Balance Sheet Information ($ in thousands)
	Dec. 31, 2013				Dec. 31, 2012
Assets:
Cash	$	7,850			$	2,650
Accountsreceivable		3,500				2,700
Inventory		5,000				3,500
Prepaid rent		200				400
Plant andequipment		15,500				13,000
Less:Accumulated depreciation		(5,600	)			(5,000	)
Totalassets	$	26,450			$	17,250
Liabilitiesand Shareholders’ Equity:
Accountspayable	$	2,400			$	1,600
Interestpayable		150				0
Unearned servicerevenue		900				650
Income taxespayable		600				900
Loan payable (due12/31/2015)		6,000				0
Common stock		10,500				10,500
Retainedearnings		5,900				3,600
Totalliabilities and shareholders' equity	$	26,450			$	17,250

Additionalinformation for the 2013 fiscal year ($ in thousands):
1.	Cash dividends of $1,500 weredeclared and paid.
2.	Equipment costing $5,000 waspurchased with cash.
3.	Equipment with a book value of$1,000 (cost of $2,500 less accumulated depreciation of $1,500) wassold for $1,000.
4.	Depreciation of $2,100 isincluded in operating expenses.

Required:

Prepare Santana Industries' 2013statement of cash flows, using the indirect method to present cashflows from operating activities. (Amounts to be deductedshould be indicated with a minus sign. Enter your answers inthousands.)

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