WELLER COMPANY
Comparative Balance Sheets
December 31
Assets	2008		2007
Cash	$ 35,000		$ 20,000
Accounts receivable	33,000		14,000
Merchandise inventory	27,000		20,000
Property, Plant and Equipment	60,000		78,000
Accumulated depreciation	(29,000)		(24,000)
Total	$126,000		$108,000
Liabilities and Stockholders' Equity
Accounts payable	$ 29,000		$ 15,000
Income taxes payable	7,000		8,000
Bonds payable	27,000		33,000
Common stock	18,000		14,000
Retained earnings	45,000		38,000
Total	$126,000		$108,000

WELLER COMPANY
Income Statement
For the Year Ended December 31, 2008
Sales			$242,000
Cost of goods sold			175,000
Gross profit			67,000
Selling expenses	$18,000
Administrative expenses	6,000		24,000
Income from operations			43,000
Interest expense			3,000
Income before income taxes			40,000
Income tax expense			8,000
Net income			$ 32,000

Additional data:

1. Dividends declared and paid were $25,000.

2. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had a book value of $8,500 at the time of sale.

3. All depreciation expense, $14,500, is in the selling expense category.

4. All sales and purchases are on account.

	Incorrect.

WELLER COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2008
Cash flows from operating activities
Net income		$
Adjustments to reconcile net income to net
cash provided by operating activities
Depreciation expense	$ 14500
Increase in accounts payable	14000
Increase in accounts receivable
Increase in merchandise inventory
Decrease in income taxes payable
Net cash provided by operating activities
Cash flows from investing activities
Sale of equipment		8500
Cash flows from financing activities
Issuance of common stock	4000
Payment of dividends
Redemption of bonds
Net cash used by financing activities
Net increase in cash		15000
Cash at beginning of period		20000
Cash at end of period		$ 35000

	Incorrect.

$