Allen Company Uses the Indirect Method to Prepare Its Statement $\quad$

question 104

True/False

Allen Company uses the indirect method to prepare its statement of cash flows. Refer to the following portion of the comparative balance sheet:
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ Allen Company
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ Comparative Balance Sheet
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ December 31, 2015 and 2014
$\begin{array}{lrrr} & 2015 & 2014 & \text { Increase/decrease } \\\text { Common Stock } & \$ 28,000 & \$ 5,000 & \$ 23,000 \\\text { Retained Earnings } & 108,000 & 82,000 & 26,000 \\\text { Treasury Stock } & (9,000) & (6,000) & (3,000) \\ \text { Total equity } & 127,000 & 81,000 & 46,000 \\\hline\end{array}$ If the net income for the year was $58,000, the company must have declared $32,000 as dividends during the year.

---

Definitions:

DSM-5

The Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition, a handbook used by healthcare professionals as the authoritative guide to the diagnosis of mental disorders.

Anorexia Nervosa

An eating disorder characterized by an obsessive fear of gaining weight, leading to extreme food restriction and dangerous weight loss.

Amenorrhea

The absence of menstruation in a woman of reproductive age, which can be a sign of health issues.

Calorie Restriction

A dietary regimen that reduces calorie intake without incurring malnutrition or a reduction in essential nutrients, often used for improving health and slowing down the aging process.