Statement of Cash Flows (Direct Method) The Wolff Company's income statement and comparative balance sheets at December 31 of 2013 and 2012 are shown below: WOLFF COMPANY Income Statement For the Year Ended December 31, 2013 Sales Revenue $889,000 Cost of Goods Sold $602,000 Wages Expense 120,400 Insurance Expense 11,200 Depreciation Expense 23,800 Interest Expense 12,600 Income Tax Expense 40,600 810,600 Net Income $78,400 WOLFF COMPANY Balance Sheets Dec. 31, 2013 Dec. 31, 2012 Assets Cash $15,400 $7,000 Accounts Receivable 57,400 44,800 Inventory 126,000 84,000 Prepaid Insurance 7,000 9,800 Plant Assets 350,000 273,000 Accumulated Depreciation (95,200) (71,400) Total Assets $460,600 $347,200 Liabilities and Stockholders' Equity Accounts Payable $9,800 $14,000 Wages Payable 12,600 8,400 Income Tax Payable 9,800 11,200 Bonds Payable 182,000 105,000 Common Stock 126,000 126,000 Retained Earnings 120,400 82,600 Total Liabilities and Stockholders' Equity $460,600 $347,200 Cash dividends of $40,600 were declared and paid during 2013. Plant assets were purchased for cash and bonds payable were issued for cash. Bond interest is paid semi-annually on June 30 and December 31. Accounts payable relate to merchandise purchases. Required a. Calculate the change in cash that occurred during 2013. b. Prepare a statement of cash flows using the direct method. c. Compute free cash flow. d. Compute the operating-cash-flow-to-current-liabilities ratio. e. Compute the operating-cash-flow-to-capital-expenditures ratio. a. Change in Cash during 2013 $Answer 0 Answer b. Use a negative sign with cash outflow answers. WOLFF COMPANY Statement of Cash Flows For Year Ended December 31, 2013 Cash Flow from Operating Activities Cash Received from Customers Answer 0 Cash paid for Merchandise Purchased Answer 0 Cash Paid to Employees Answer 0 Cash Paid as Insurance Answer 0 Cash Paid for Interest Answer 0 Cash Paid as Income Taxes Answer 0 Answer 0 Cash Provided by Operating Activities Answer 0 Cash Flow from Investing Activities Purchase of Plant Assets Answer 0 Cash Flow from Financing Activities Issuance of Bonds Payable Answer 0 Payment of Dividends Answer 0 Cash Provided by Financing Activities Answer 0 Net Change in Cash Answer 0 Cash at Beginning of Year Answer 0 Cash at End of Year Answer 0 c. Free cash flow $Answer 0 d. Operating-cash-flow-to-current-liabilities ratio. Round answer to two decimal places. Answer 0 e. Operating-cash-flow-to-capital-expenditures ratio. Round answer to two decimal places. Answer 0